CNX Resources (CNX Resources) Predictability Rank

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What is CNX Resources Predictability Rank?

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.

CNX Resources 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

CNX Resources Predictability Rank Related Terms

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CNX Resources (CNX Resources) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » CNX Resources Corp (NYSE:CNX) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

CGD:Germany CGD:Germany

Address

1000 Horizon Vue Drive, Canonsburg, PA, USA, 15317-6506

Website

https://www.cnx.com

CNX Resources Corp is an independent natural gas and midstream company engaged in the exploration, development, production and acquisition of natural gas properties in the Appalachian Basin. The company's operating segment include Shale and Coalbed Methane. It generates maximum revenue from the Shale segment. It also has other segment that includes nominal shallow oil and gas production.

Executives

Bernard Jr Lanigan	director	150 WEST CHURCH AVENUE, MARYVILLE TN 37801
Navneet Behl	officer: Chief Operating Officer	1000 HORIZON VUE DRIVE, CANONSBURG PA 15317
Robert Agbede	director	1000 CONSOL ENERGY DRIVE, SUITE 400, CANONSBURG PA 15317
Hayley Scott	officer: Chief Risk Officer	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Ravi Srivastava	officer: Vice President, Green Ventures	1000 CONSOL ENERGY DRIVE, SUITE 400, CANONSBURG PA 15317
Alexander John Reyes	officer: EVP, GC & Corp. Sec.	CNX CENTER, 1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Donald W. Rush	officer: EVP & Chief Financial Officer	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Alan K Shepard	officer: Vice President and CAO	1000 CONSOL ENERGY DRIVE SUITE 400, CANONSBURG PA 15317
N J Deiuliis	director, officer: President and CEO	1800 WASHINGTON RD., PITTSBURGH PA 15421-4000
Stephanie L Gill	officer: SVP, GC and Secretary	C/O VERTIV HOLDINGS CO, 1050 DEARBORN DRIVE, COLUMBUS OH 43085
Olayemi Akinkugbe	officer: Chief Excellence Officer	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Ian R Mcguire	director	PO BOX 1526, ROSS CA 94957
J. Palmer Clarkson	director	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Chad A Griffith	officer: VP Commercial & VP Marketing	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317
Andrea D. Passman	officer: Sr VP Engineering & Operations	1000 CONSOL ENERGY DRIVE, CANONSBURG PA 15317