Albion Development VCT (LSE:AADV) GF Value Rank : 0 (As of Jun. 08, 2024)

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What is Albion Development VCT GF Value Rank?

Albion Development VCT has the GF Value Rank of 0.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

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Albion Development VCT (LSE:AADV) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Asset Management » Albion Development VCT PLC (LSE:AADV) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

1 Benjamin Street, London, GBR, EC1M 5QL

Website

https://www.albion.capital

Albion Development VCT PLC is a venture capital trust. Its investment objective is to provide investors with a regular and predictable source of dividend income combined with the prospects of long-term capital growth. This is achieved by establishing a diversified portfolio of holdings in smaller, unquoted companies whilst at the same time selecting and structuring investments in such a way as to reduce the risks normally associated with an investment in such companies. Group's investment portfolio includes various sectors such as IT, cash and cash equivalents, FinTech, education, renewable energy, healthcare, travel and retail, business services, and support services. Albion generates revenue from loan stock interest and dividend income.

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