Larimar Therapeutics (Larimar Therapeutics) Predictability Rank

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What is Larimar Therapeutics 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.

Larimar Therapeutics 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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Larimar Therapeutics (Larimar Therapeutics) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Biotechnology » Larimar Therapeutics Inc (NAS:LRMR) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

ZA71:Germany

Address

Three Bala Plaza East, Suite 506, Bala Cynwyd, PA, USA, 19004

Website

https://www.larimartx.com

Larimar Therapeutics Inc is a clinical-stage biotechnology company focused on developing treatments for patients suffering from complex rare diseases using novel cell-penetrating peptide technology platform. Its lead product candidate, CTI-1601, is a subcutaneously administered, recombinant fusion protein intended to deliver human frataxin (FXN) an essential protein, to the mitochondria of patients with Friedreich's ataxia.

Executives

Gopi Shankar	officer: Chief Development Officer	C/O LARIMAR THERAPEUTICS, INC., THREE BALA PLAZA EAST. SUITE 506, BALA CYNWYD PA 19004
Jeffrey W Sherman	director	C/O IDM PHARMA, INC., 9 PARKER, SUITE 100, IRVINE CA 92618
Russell Clayton	officer: Chief Medical Officer	2600 KELLY RD, WARRINGTON PA 18976
Carole Ben-maimon	director, officer: President and CEO	C/O IMPAX LABORATORIES, INC., 30831 HUNTWOOD AVENUE, HAYWARD CA 94544
Michael Celano	officer: Chief Financial Officer	220 EAST FIRST STREET, BETHLEHEM PA 18015
Joseph Truitt	director	C/O ACHILLION PHARMACEUTICALS, INC., 300 GEORGE STREET, NEW HAVEN CT 06511
Thomas Edward Hamilton	director	211 STUYVESANT AVE, RYE NY 10580
James E Flynn	10 percent owner, other: Possible Member of 10% Group	780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017
Jonathan S Leff	director	C/O DEERFIELD MANAGEMENT COMPANY, L.P, 780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017
Deerfield Mgmt Hif, L.p.	director, 10 percent owner, other: Director by Deputization	780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017
Chondrial Therapeutics Holdings, Llc	10 percent owner	150 MONUMENT ROAD, SUITE 207, BALA CYNWYD PA 19004
Deerfield Mgmt Iv, L.p.	director, 10 percent owner, other: Director by Deputization	780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017
Deerfield Private Design Fund Iv, L.p.	director, 10 percent owner, other: Director by Deputization	780 THIRD AVENUE 37TH FLOOR, NEW YORK NY 10017
Deerfield Healthcare Innovations Fund, L.p.	director, 10 percent owner, other: Director by Deputization	780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017
Deerfield Mgmt Iii, L.p.	director, 10 percent owner, other: Director by Deputization	780 THIRD AVENUE, 37TH FLOOR, NEW YORK NY 10017