Buy, sell or hold: POOL Stock Forecast

Security indices are the main tools for evaluation of the status of financial markets. Moreover, a main part of the economy of any country is constituted of investment in stock markets. Therefore, investors could maximize the return of investment if it becomes possible to predict the future trend of stock market with appropriate methods. The nonlinearity and nonstationarity of financial series make their prediction complicated. This study seeks to evaluate the prediction power of machine-learning models in a stock market. We evaluate Pool Corporation prediction models with Modular Neural Network (Emotional Trigger/Responses Analysis) and Linear Regression1,2,3,4 and conclude that the POOL stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold POOL stock.


Keywords: POOL, Pool Corporation, stock forecast, machine learning based prediction, risk rating, buy-sell behaviour, stock analysis, target price analysis, options and futures.

Key Points

  1. How do you pick a stock?
  2. What are the most successful trading algorithms?
  3. What are the most successful trading algorithms?

POOL Target Price Prediction Modeling Methodology

The classical linear multi-factor stock selection model is widely used for long-term stock price trend prediction. However, the stock market is chaotic, complex, and dynamic, for which reasons the linear model assumption may be unreasonable, and it is more meaningful to construct a better-integrated stock selection model based on different feature selection and nonlinear stock price trend prediction methods. We consider Pool Corporation Stock Decision Process with Linear Regression where A is the set of discrete actions of POOL stock holders, F is the set of discrete states, P : S × F × S → R is the transition probability distribution, R : S × F → R is the reaction function, and γ ∈ [0, 1] is a move factor for expectation.1,2,3,4


F(Linear Regression)5,6,7= p a 1 p a 2 p 1 n p j 1 p j 2 p j n p k 1 p k 2 p k n p n 1 p n 2 p n n X R(Modular Neural Network (Emotional Trigger/Responses Analysis)) X S(n):→ (n+1 year) e x rx

n:Time series to forecast

p:Price signals of POOL stock

j:Nash equilibria

k:Dominated move

a:Best response for target price

 

For further technical information as per how our model work we invite you to visit the article below: 

How do AC Investment Research machine learning (predictive) algorithms actually work?

POOL Stock Forecast (Buy or Sell) for (n+1 year)


Sample Set: Neural Network
Stock/Index: POOL Pool Corporation
Time series to forecast n: 13 Nov 2022 for (n+1 year)

According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold POOL stock.

X axis: *Likelihood% (The higher the percentage value, the more likely the event will occur.)

Y axis: *Potential Impact% (The higher the percentage value, the more likely the price will deviate.)

Z axis (Yellow to Green): *Technical Analysis%

Adjusted IFRS* Prediction Methods for Pool Corporation

  1. For the purpose of applying the requirements in paragraphs 6.4.1(c)(i) and B6.4.4–B6.4.6, an entity shall assume that the interest rate benchmark on which the hedged cash flows and/or the hedged risk (contractually or noncontractually specified) are based, or the interest rate benchmark on which the cash flows of the hedging instrument are based, is not altered as a result of interest rate benchmark reform.
  2. Interest Rate Benchmark Reform—Phase 2, which amended IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, issued in August 2020, added paragraphs 5.4.5–5.4.9, 6.8.13, Section 6.9 and paragraphs 7.2.43–7.2.46. An entity shall apply these amendments for annual periods beginning on or after 1 January 2021. Earlier application is permitted. If an entity applies these amendments for an earlier period, it shall disclose that fact.
  3. If an entity previously accounted at cost (in accordance with IAS 39), for an investment in an equity instrument that does not have a quoted price in an active market for an identical instrument (ie a Level 1 input) (or for a derivative asset that is linked to and must be settled by delivery of such an equity instrument) it shall measure that instrument at fair value at the date of initial application. Any difference between the previous carrying amount and the fair value shall be recognised in the opening retained earnings (or other component of equity, as appropriate) of the reporting period that includes the date of initial application.
  4. If a variable-rate financial liability bears interest of (for example) three-month LIBOR minus 20 basis points (with a floor at zero basis points), an entity can designate as the hedged item the change in the cash flows of that entire liability (ie three-month LIBOR minus 20 basis points—including the floor) that is attributable to changes in LIBOR. Hence, as long as the three-month LIBOR forward curve for the remaining life of that liability does not fall below 20 basis points, the hedged item has the same cash flow variability as a liability that bears interest at three-month LIBOR with a zero or positive spread. However, if the three-month LIBOR forward curve for the remaining life of that liability (or a part of it) falls below 20 basis points, the hedged item has a lower cash flow variability than a liability that bears interest at threemonth LIBOR with a zero or positive spread.

*International Financial Reporting Standards (IFRS) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

Conclusions

Pool Corporation assigned short-term B2 & long-term B1 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Emotional Trigger/Responses Analysis) with Linear Regression1,2,3,4 and conclude that the POOL stock is predictable in the short/long term. According to price forecasts for (n+1 year) period: The dominant strategy among neural network is to Hold POOL stock.

Financial State Forecast for POOL Pool Corporation Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2B1
Operational Risk 8458
Market Risk4658
Technical Analysis3966
Fundamental Analysis3732
Risk Unsystematic8170

Prediction Confidence Score

Trust metric by Neural Network: 88 out of 100 with 502 signals.

References

  1. Breiman L, Friedman J, Stone CJ, Olshen RA. 1984. Classification and Regression Trees. Boca Raton, FL: CRC Press
  2. M. Benaim, J. Hofbauer, and S. Sorin. Stochastic approximations and differential inclusions, Part II: Appli- cations. Mathematics of Operations Research, 31(4):673–695, 2006
  3. D. Bertsekas. Nonlinear programming. Athena Scientific, 1999.
  4. Efron B, Hastie T. 2016. Computer Age Statistical Inference, Vol. 5. Cambridge, UK: Cambridge Univ. Press
  5. P. Marbach. Simulated-Based Methods for Markov Decision Processes. PhD thesis, Massachusetts Institute of Technology, 1998
  6. Vapnik V. 2013. The Nature of Statistical Learning Theory. Berlin: Springer
  7. D. Bertsekas. Dynamic programming and optimal control. Athena Scientific, 1995.
Frequently Asked QuestionsQ: What is the prediction methodology for POOL stock?
A: POOL stock prediction methodology: We evaluate the prediction models Modular Neural Network (Emotional Trigger/Responses Analysis) and Linear Regression
Q: Is POOL stock a buy or sell?
A: The dominant strategy among neural network is to Hold POOL Stock.
Q: Is Pool Corporation stock a good investment?
A: The consensus rating for Pool Corporation is Hold and assigned short-term B2 & long-term B1 forecasted stock rating.
Q: What is the consensus rating of POOL stock?
A: The consensus rating for POOL is Hold.
Q: What is the prediction period for POOL stock?
A: The prediction period for POOL is (n+1 year)

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