Vontier (Vontier) Predictability Rank

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What is Vontier 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.

Vontier 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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Vontier (Vontier) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Vontier Corp (NYSE:VNT) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

47O:Germany

Address

5438 Wade Park Boulevard, Suite 600, Raleigh, NC, USA, 27607

Website

https://www.vontier.com

Vontier, spun off from Fortive in 2020, is an industrial technology company with a portfolio of transportation and mobility solutions. The company offers a wide array of products and services, including fueling equipment, sensors, point-of-sale and payment systems, telematics, and equipment used by vehicle mechanics and technicians. Vontier generated approximately $3.2 billion in sales and $578 million in operating profit in 2022.

Executives

David M Foulkes	director	C/O BRUNSWICK CORPORATION, 26125 N RIVERWOOD BLVD. SUITE 500, METTAWA IL 60045-3420
Anshooman Aga	officer: SVP, Chief Financial Officer	PO BOX 85587, SAN DIEGO CA 92186-5587
Christopher J Klein	director	520 LAKE COOK ROAD, DEERFIELD IL 60015
Gloria R. Boyland	director	6100 N. WESTERN AVENUE, OKLAHOMA CITY OK 73118
Mark D Morelli	officer: See Remarks	205 CROSSPOINT PARKWAY, GETZVILLE NY 14068
Kathryn K. Rowen	officer: See Remarks	C/O VONTIER CORPORATION, 5420 WADE PARK BLVD., SUITE 206, RALEIGH NC 27607
Andrew Miller	director	111 MCINNIS PARKWAY, SAN RAFAEL CA 94903
Aaron W Saak	officer: Pres & CEO, Mobility Solutions	C/O VONTIER CORPORATION, 5438 WADE PARK BLVD., SUITE 600, RALEIGH NC 27607
David H. Naemura	officer: See Remarks	C/O GATES INDUSTRIAL CORPORATION PLC, 1144 FIFTEENTH STREET, SUITE 1400, DENVER CO 80202
Paul V. Shimp	officer: VP, Chief Accounting Officer	C/O VONTIER CORPORATION, 5438 WADE PARK BLVD., SUITE 600, RALEIGH NC 27607
Lynn Ross	officer: See Remarks	100 CRESCENT CENTRE PARKWAY, SUITE 800, TUCKER GA 30084
Maryrose Sylvester	director	C/O 3700 WEST JUNEAU AVENUE, MILWAUKEE WI 53208
Robert L Eatroff	director	C/O VONTIER CORPORATION, 5438 WADE PARK BLVD STE 600, RALEIGH NC 27607
Karen C Francis	director	200 SW 1ST AVE, SUITE 1600, FORT LAUDERDALE FL 33301
Andrew R. Nash	officer: See Remarks	C/O VONTIER CORPORATION, 5420 WADE PARK BLVD, SUITE 206, RALEIGH NC 27607