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The E W Scripps Co (The E W Scripps Co) Predictability Rank


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What is The E W Scripps Co Predictability Rank?

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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.

The E W Scripps Co 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

The E W Scripps Co Predictability Rank Related Terms

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The E W Scripps Co (The E W Scripps Co) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » The E W Scripps Co (NAS:SSP) » Definitions » Predictability Rank
Comparable Companies
IHRT FUBO SGA UONE CMLS CURI SJ GTN.A LPTV BBGI LSXMA XTER:RRTL SAU:4072 TSE:9401 TSE:9404 LSE:ITV LUX:SESGL BOM:532733 TSE:4676 TGNA
Traded in Other Exchanges
SQ6B:Germany
Address
312 Walnut Street, Suite 2800, Scripps Center, Cincinnati, OH, USA, 45202
Website
https://www.scripps.com
The E W Scripps Co is a media enterprise with interests in local and national media brands. It owns and operates a collection of daily and community newspapers, primarily in medium-sized cities in the southern and western portions of the United States. The company's operating segment includes Local Media, Scripps Networks, and Other. It generates maximum revenue from the Local Media segment. The Local Media segment includes approximately 61 local broadcast stations and their related digital operations.
Executives
John Patrick Scripps 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Elizabeth Scripps 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Kate O'brian officer: EVP, News 312 WALNUT STREET, 28H FLOOR, CINCINNATI OH 45202
Lisa A Knutson officer: Senior VP of Human Resources 312 WALNUT STREET, 28TH FLOOR, CINCINNATI OH 45202
Granado Corina S. 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT. MITCHELL KY 41017
Geraldine Scripps Granado 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Granado Raymundo H. Jr. 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Anthony S. Granado 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Ellen B. Granado 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Manuel E. Granado 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT MITCHELL KY 41017
Eli W Scripps 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT. MITCHELL KY 41017
William A. Scripps 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT. MITCHELL KY 41017
Gerald J. Scripps 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT. MITCHELL KY 41017
Sanchez Mary Ann S. 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE, SUITE 400, FT. MITCHELL KY 41017
Monica Holcomb 10 percent owner C/O MIRAMAR SERVICES, INC., 250 GRANDVIEW AVE., SUITE 400, FT MITCHELL KY 41017