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Modiv Industrial (Modiv Industrial) Predictability Rank


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What is Modiv Industrial 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.


Modiv Industrial 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

PredictablesNon-PredictableAll stocks
Total Number of stocks57018332403
Total Lost Money61830891
Total Lost More Than 50%18412430
Total Lost More Than 90%48690
Average Gain260.6%100.0%138.1%
Median Gain150.0%13.0%39.0%
Maximum Gain2852.0%11483.0%11483.0%
Maximum Loss-100.0%-100.0%-100.0%
Annualized Average Gain12.7%6.7%8.4%
Annualized Median Gain8.9%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 Rank5-Star4.5-Star4-Star3.5-Star3-Star2.5-Star2-Star1-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

Also read:

Part II: What worked in the market from 1998-2008? Part II: Role of Valuations
Part III: Intrinsic Value, Discounted Cash Flow and Margin of Safety

Modiv Industrial Predictability Rank Related Terms

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Modiv Industrial (Modiv Industrial) Business Description

Traded in Other Exchanges
N/A
Address
200 S. Virginia Street, Suite 800, Reno, NV, USA, 89501
Modiv Industrial Inc Formerly Modiv Inc is a pioneer in the direct-to-consumer commercial real estate product industry. It provides individual investors access to real estate and real estate-related investments designed to provide both income and long-term growth. The Company has invested in single-tenant income-producing properties. All of the company's consolidated revenues are derived from company's consolidated real estate properties.
Executives
Aaron Scott Halfacre officer: CEO 2100 REXFORD ROAD, SUITE 300, CHARLOTTE NC 28211
Nolan Thomas H Jr director 14631 NORTH SCOTTSDALE RD, SUITE 200, SCOTTSDALE AZ 85254
Kimberly J Smith director 2325 E CAMELBACK RD, SUITE 1100, PHOENIX AZ 85016
Raymond J Pacini officer: CFO 550 SOUTH HOPE STREET, SUITE 2850, LOS ANGELES CA 90071
Adam Scott Markman director TWO NORTH RIVERSIDE PLAZA, SUITE 600, CHICAGO IL 60606
Tirondola Connie director 14 DAYDREAM LN, ANDOVER NJ 07821
Asma Ishaq director 120 NEWPORT CENTER DRIVE, NEWPORT BEACH CA 92660
Curtis B Mcwilliams director 450 SOUTH ORANGE AVENUE, ORLANDO FL 32801
Group Of Trophy, Llc 10 percent owner 21140 S. AVALON BLVD, CARSON CA 90745
Joe F Hanauer director 361 FOREST AVE, LAGUNA BEACH CA 92651
Sandra G Sciutto officer: CAO 6 EXECUTIVE CIRCLE, SUITE 250, IRVINE CA 92614
David Perduk officer: CIO PO BOX 1705, LAGUNA BEACH CA 92652
John Harold Davis officer: CFO 3090 BRISTOL STREET, SUITE 550, COSTA MESA CA 92626
Jeffrey Randolph other: Trust Manager 3080 BRISTOL STREET, SUITE 550, COSTA MESA CA 92626
John C Wang director