LON:BA. BAE SYSTEMS PLC

Outlook: BAE SYSTEMS PLC is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Sell
Time series to forecast n: 04 Apr 2023 for (n+3 month)
Methodology : Modular Neural Network (Market News Sentiment Analysis)

Abstract

BAE SYSTEMS PLC prediction model is evaluated with Modular Neural Network (Market News Sentiment Analysis) and Factor^1,2,3,4 and it is concluded that the LON:BA. stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Sell

Key Points

1. How accurate is machine learning in stock market?
2. What is statistical models in machine learning?
3. Is Target price a good indicator?

LON:BA. Target Price Prediction Modeling Methodology

We consider BAE SYSTEMS PLC Decision Process with Modular Neural Network (Market News Sentiment Analysis) where A is the set of discrete actions of LON:BA. 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(Factor)^5,6,7= $\begin{array}{cccc}{p}_{\mathrm{a}1}& p_{\mathrm{a}2}& \dots & p_{1n}\\ & ⋮\\ p_{j1}& p_{j2}& \dots & p_{jn}\\ & ⋮\\ p_{k1}& p_{k2}& \dots & p_{kn}\\ & ⋮\\ p_{n1}& p_{n2}& \dots & p_{nn}\end{array}$ X R(Modular Neural Network (Market News Sentiment Analysis)) X S(n):→ (n+3 month) $\sum _{i=1}^n\left(r_i\right)$

n:Time series to forecast

p:Price signals of LON:BA. stock

j:Nash equilibria (Neural Network)

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?

LON:BA. Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: LON:BA. BAE SYSTEMS PLC
Time series to forecast n: 04 Apr 2023 for (n+3 month)

According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Sell

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 (Grey to Black): *Technical Analysis%

IFRS Reconciliation Adjustments for BAE SYSTEMS PLC

1. Adjusting the hedge ratio allows an entity to respond to changes in the relationship between the hedging instrument and the hedged item that arise from their underlyings or risk variables. For example, a hedging relationship in which the hedging instrument and the hedged item have different but related underlyings changes in response to a change in the relationship between those two underlyings (for example, different but related reference indices, rates or prices). Hence, rebalancing allows the continuation of a hedging relationship in situations in which the relationship between the hedging instrument and the hedged item chang
2. The significance of a change in the credit risk since initial recognition depends on the risk of a default occurring as at initial recognition. Thus, a given change, in absolute terms, in the risk of a default occurring will be more significant for a financial instrument with a lower initial risk of a default occurring compared to a financial instrument with a higher initial risk of a default occurring.
3. Sales that occur for other reasons, such as sales made to manage credit concentration risk (without an increase in the assets' credit risk), may also be consistent with a business model whose objective is to hold financial assets in order to collect contractual cash flows. In particular, such sales may be consistent with a business model whose objective is to hold financial assets in order to collect contractual cash flows if those sales are infrequent (even if significant in value) or insignificant in value both individually and in aggregate (even if frequent). If more than an infrequent number of such sales are made out of a portfolio and those sales are more than insignificant in value (either individually or in aggregate), the entity needs to assess whether and how such sales are consistent with an objective of collecting contractual cash flows. Whether a third party imposes the requirement to sell the financial assets, or that activity is at the entity's discretion, is not relevant to this assessment. An increase in the frequency or value of sales in a particular period is not necessarily inconsistent with an objective to hold financial assets in order to collect contractual cash flows, if an entity can explain the reasons for those sales and demonstrate why those sales do not reflect a change in the entity's business model. In addition, sales may be consistent with the objective of holding financial assets in order to collect contractual cash flows if the sales are made close to the maturity of the financial assets and the proceeds from the sales approximate the collection of the remaining contractual cash flows.
4. An embedded prepayment option in an interest-only or principal-only strip is closely related to the host contract provided the host contract (i) initially resulted from separating the right to receive contractual cash flows of a financial instrument that, in and of itself, did not contain an embedded derivative, and (ii) does not contain any terms not present in the original host debt contract.

*International Financial Reporting Standards (IFRS) adjustment process involves reviewing the company's financial statements and identifying any differences between the company's current accounting practices and the requirements of the IFRS. If there are any such differences, neural network makes adjustments to financial statements to bring them into compliance with the IFRS.

Conclusions

BAE SYSTEMS PLC is assigned short-term Ba1 & long-term Ba1 estimated rating. BAE SYSTEMS PLC prediction model is evaluated with Modular Neural Network (Market News Sentiment Analysis) and Factor^1,2,3,4 and it is concluded that the LON:BA. stock is predictable in the short/long term. According to price forecasts for (n+3 month) period, the dominant strategy among neural network is: Sell

LON:BA. BAE SYSTEMS PLC Financial Analysis*

Rating	Short-Term	Long-Term Senior
Outlook*	Ba1	Ba1
Income Statement	Baa2	Ba3
Balance Sheet	Baa2	Baa2
Leverage Ratios	C	B3
Cash Flow	Ba2	Ba2
Rates of Return and Profitability	Baa2	C

*Financial analysis is the process of evaluating a company's financial performance and position by neural network. It involves reviewing the company's financial statements, including the balance sheet, income statement, and cash flow statement, as well as other financial reports and documents.
How does neural network examine financial reports and understand financial state of the company?

Prediction Confidence Score

Trust metric by Neural Network: 76 out of 100 with 672 signals.

References

1. Athey S, Wager S. 2017. Efficient policy learning. arXiv:1702.02896 [math.ST]
2. Vapnik V. 2013. The Nature of Statistical Learning Theory. Berlin: Springer
3. Belsley, D. A. (1988), "Modelling and forecast reliability," International Journal of Forecasting, 4, 427–447.
4. Breiman L. 1993. Better subset selection using the non-negative garotte. Tech. Rep., Univ. Calif., Berkeley
5. Babula, R. A. (1988), "Contemporaneous correlation and modeling Canada's imports of U.S. crops," Journal of Agricultural Economics Research, 41, 33–38.
6. R. Sutton and A. Barto. Reinforcement Learning. The MIT Press, 1998
7. Bottou L. 1998. Online learning and stochastic approximations. In On-Line Learning in Neural Networks, ed. D Saad, pp. 9–42. New York: ACM

Frequently Asked Questions

Q: What is the prediction methodology for LON:BA. stock?
A: LON:BA. stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market News Sentiment Analysis) and Factor
Q: Is LON:BA. stock a buy or sell?
A: The dominant strategy among neural network is to Sell LON:BA. Stock.
Q: Is BAE SYSTEMS PLC stock a good investment?
A: The consensus rating for BAE SYSTEMS PLC is Sell and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of LON:BA. stock?
A: The consensus rating for LON:BA. is Sell.
Q: What is the prediction period for LON:BA. stock?
A: The prediction period for LON:BA. is (n+3 month)

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