Activation Group Holdings (HKSE:09919) Predictability Rank

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What is Activation Group Holdings Predictability Rank?

Not Rated

Warren Buffett said many times that the companies he likes are:

1. Simple businesses that he understands
2. that have predictable and proven earnings and
3. with economic moat
4. those can be bought at a reasonable price.

It is hard to quantify "simple businesses that he (Buffett) understands", so we will focus on the other three characteristics instead. In GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank, we will show that the businesses that have predictable and proven earnings are usually also simple businesses that an average person could understand.

GuruFocus conducted a back test study of Warren Buffett's strategy of "buying good companies at fair prices" for the years from 1998-2008.

Activation Group Holdings Predictability Rank Calculation

In our database there are 2403 stocks that have been traded from Jan. 2, 1998 to Aug. 31, 2008. We have the complete 10-year financial data and trading prices of these companies for this period. We rank the predictability of these companies based on the consistency of their revenue per share and EBITDA (earning before interest, tax, depreciation and amortization) per share over the past ten fiscal years, and study the correlation between the stock performances and the predictability of the business.

Our study may be subject to these biases and assumptions:

Dividend yields are not counted for investment returns
Effects of price changes due to spin-offs may not be fully adjusted
Study is subjected to survivorship bias due to de-listing, bankruptcy, LBO, M&A, etc.

The correlation between business predictability and investment returns of a company is showed below.

Correlation Between Business Predictability and Investment Returns

	Predictables	Non-Predictable	All stocks
Total Number of stocks	570	1833	2403
Total Lost Money	61	830	891
Total Lost More Than 50%	18	412	430
Total Lost More Than 90%	4	86	90
Average Gain	260.6%	100.0%	138.1%
Median Gain	150.0%	13.0%	39.0%
Maximum Gain	2852.0%	11483.0%	11483.0%
Maximum Loss	-100.0%	-100.0%	-100.0%
Annualized Average Gain	12.7%	6.7%	8.4%
Annualized Median Gain	8.9%	1.1%	3.1%

For the 570 predictable companies, we have seen strong correlation between the predictability of businesses and the stock performances over the past 10 years, regardless of the valuation of business at 1998. Accordingly, we have ranked the business predictability from 5-star to 1-star, as shown in this table.

Predictability Rank	5-Star	4.5-Star	4-Star	3.5-Star	3-Star	2.5-Star	2-Star	1-Star (non-predictable)	Average among all
% Out of All 2403 Stocks	3.3%	2.9%	3.7%	3.3%	3.3%	3.7%	3.3%	76.3%	100%
% that are in Loss (10y)	3%	10%	8%	9%	11%	18%	16%	45%	37%
Average Gain (10y)	364.6%	330.9%	278.0%	235.1%	243.5%	227.8%	154.8%	100.0%	138.1%
Median Gain (10y)	238.5%	193.5%	171.0%	159.0%	132.5%	113.5%	87.0%	13.0%	39.0%
Maximum Gainer	2228.0%	2547.0%	2452.0%	2852.0%	2432.0%	1892.0%	1807.0%	11483.0%	11483.0%
Maximum Loser	-82.0%	-53.0%	-67.0%	-100.0%	-83.0%	-100.0%	-78.0%	-100.0%	-100.0%
Annualized Average Gain	15.4%	14.6%	13.2%	12.0%	12.2%	11.7%	9.1%	6.7%	8.4%
Annualized Median Gain	12.1%	10.6%	9.8%	9.3%	8.2%	7.3%	6.0%	1.1%	3.1%

For detailed information about each predictability rank, please go to GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank

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Activation Group Holdings (HKSE:09919) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » Activation Group Holdings Ltd (HKSE:09919) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

No. 399A Liu Zhou Road, 8th Floor, Hengdi Warehouse International Building, Xuhui District, Shanghai, CHN, 200235

Website

https://www.activation-gp.com

Activation Group Holdings Ltd is an integrated marketing solutions provider. The company focuses on the provision of experiential marketing, digital and brand communication, and public relations services. Its operating segment includes Experiential marketing services, Digital and communication services and IP development. The company generates maximum revenue from Experiential marketing services. Geographically, it derives a majority of revenue from Mainland China and also has a presence in Hong Kong/Singapore.

Executives

Lau Kam Yiu	2101 Beneficial owner
Rays Capital Partners Limited	2102 Investment manager
Ruan David Ching Chi	2201 Interest of corporation controlled by you
Snow Lake China Master Fund, Ltd.	2101 Beneficial owner
Snow Lake China Offshore Fund, Ltd.	2201 Interest of corporation controlled by you
Snow Lake Management Llc	2201 Interest of corporation controlled by you
Snow Lake Management Lp	2102 Investment manager
Ma Sean	2201 Interest of corporation controlled by you
Ai De Zhong Xin Shang Hai Tou Zi Guan Li Qi Ye You Xian He Huo	2101 Beneficial owner
Low Wei Mun	2101 Beneficial owner
Chan Wai Bun	2101 Beneficial owner
Li Meixuan	2202 Interest of your spouse
Chung Wing Ting	2202 Interest of your spouse
Ng Bo Sing	2101 Beneficial owner
Act Partners Global Ltd.	2201 Interest of corporation controlled by you

Activation Group Holdings (HKSE:09919) Headlines

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