Modelling A.I. in Economics

TARO Taro Pharmaceutical Industries Ltd. Ordinary Shares

Outlook: Taro Pharmaceutical Industries Ltd. Ordinary Shares is assigned short-term Ba1 & long-term Ba1 estimated rating.
Dominant Strategy : Hold
Time series to forecast n: 13 Apr 2023 for (n+6 month)
Methodology : Inductive Learning (ML)

Abstract

Taro Pharmaceutical Industries Ltd. Ordinary Shares prediction model is evaluated with Inductive Learning (ML) and Chi-Square1,2,3,4 and it is concluded that the TARO stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Hold

Key Points

  1. What is the use of Markov decision process?
  2. Technical Analysis with Algorithmic Trading
  3. Market Risk

TARO Target Price Prediction Modeling Methodology

We consider Taro Pharmaceutical Industries Ltd. Ordinary Shares Decision Process with Inductive Learning (ML) where A is the set of discrete actions of TARO 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(Chi-Square)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(Inductive Learning (ML)) X S(n):→ (n+6 month) i = 1 n s i

n:Time series to forecast

p:Price signals of TARO 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?

TARO Stock Forecast (Buy or Sell) for (n+6 month)

Sample Set: Neural Network
Stock/Index: TARO Taro Pharmaceutical Industries Ltd. Ordinary Shares
Time series to forecast n: 13 Apr 2023 for (n+6 month)

According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Hold

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 Taro Pharmaceutical Industries Ltd. Ordinary Shares

  1. Credit risk analysis is a multifactor and holistic analysis; whether a specific factor is relevant, and its weight compared to other factors, will depend on the type of product, characteristics of the financial instruments and the borrower as well as the geographical region. An entity shall consider reasonable and supportable information that is available without undue cost or effort and that is relevant for the particular financial instrument being assessed. However, some factors or indicators may not be identifiable on an individual financial instrument level. In such a case, the factors or indicators should be assessed for appropriate portfolios, groups of portfolios or portions of a portfolio of financial instruments to determine whether the requirement in paragraph 5.5.3 for the recognition of lifetime expected credit losses has been met.
  2. An entity shall assess separately whether each subgroup meets the requirements in paragraph 6.6.1 to be an eligible hedged item. If any subgroup fails to meet the requirements in paragraph 6.6.1, the entity shall discontinue hedge accounting prospectively for the hedging relationship in its entirety. An entity also shall apply the requirements in paragraphs 6.5.8 and 6.5.11 to account for ineffectiveness related to the hedging relationship in its entirety.
  3. Historical information is an important anchor or base from which to measure expected credit losses. However, an entity shall adjust historical data, such as credit loss experience, on the basis of current observable data to reflect the effects of the current conditions and its forecasts of future conditions that did not affect the period on which the historical data is based, and to remove the effects of the conditions in the historical period that are not relevant to the future contractual cash flows. In some cases, the best reasonable and supportable information could be the unadjusted historical information, depending on the nature of the historical information and when it was calculated, compared to circumstances at the reporting date and the characteristics of the financial instrument being considered. Estimates of changes in expected credit losses should reflect, and be directionally consistent with, changes in related observable data from period to period
  4. The definition of a derivative refers to non-financial variables that are not specific to a party to the contract. These include an index of earthquake losses in a particular region and an index of temperatures in a particular city. Non-financial variables specific to a party to the contract include the occurrence or non-occurrence of a fire that damages or destroys an asset of a party to the contract. A change in the fair value of a non-financial asset is specific to the owner if the fair value reflects not only changes in market prices for such assets (a financial variable) but also the condition of the specific non-financial asset held (a non-financial variable). For example, if a guarantee of the residual value of a specific car exposes the guarantor to the risk of changes in the car's physical condition, the change in that residual value is specific to the owner of the car.

*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

Taro Pharmaceutical Industries Ltd. Ordinary Shares is assigned short-term Ba1 & long-term Ba1 estimated rating. Taro Pharmaceutical Industries Ltd. Ordinary Shares prediction model is evaluated with Inductive Learning (ML) and Chi-Square1,2,3,4 and it is concluded that the TARO stock is predictable in the short/long term. According to price forecasts for (n+6 month) period, the dominant strategy among neural network is: Hold

TARO Taro Pharmaceutical Industries Ltd. Ordinary Shares Financial Analysis*

Rating Short-Term Long-Term Senior
Outlook*Ba1Ba1
Income StatementCC
Balance SheetCaa2Ba3
Leverage RatiosCBaa2
Cash FlowB1Caa2
Rates of Return and ProfitabilityB3B3

*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: 75 out of 100 with 556 signals.

References

  1. R. Sutton, D. McAllester, S. Singh, and Y. Mansour. Policy gradient methods for reinforcement learning with function approximation. In Proceedings of Advances in Neural Information Processing Systems 12, pages 1057–1063, 2000
  2. S. Bhatnagar. An actor-critic algorithm with function approximation for discounted cost constrained Markov decision processes. Systems & Control Letters, 59(12):760–766, 2010
  3. Kitagawa T, Tetenov A. 2015. Who should be treated? Empirical welfare maximization methods for treatment choice. Tech. Rep., Cent. Microdata Methods Pract., Inst. Fiscal Stud., London
  4. Chernozhukov V, Chetverikov D, Demirer M, Duflo E, Hansen C, et al. 2018a. Double/debiased machine learning for treatment and structural parameters. Econom. J. 21:C1–68
  5. Clements, M. P. D. F. Hendry (1995), "Forecasting in cointegrated systems," Journal of Applied Econometrics, 10, 127–146.
  6. Akgiray, V. (1989), "Conditional heteroscedasticity in time series of stock returns: Evidence and forecasts," Journal of Business, 62, 55–80.
  7. Bai J. 2003. Inferential theory for factor models of large dimensions. Econometrica 71:135–71
Frequently Asked QuestionsQ: What is the prediction methodology for TARO stock?
A: TARO stock prediction methodology: We evaluate the prediction models Inductive Learning (ML) and Chi-Square
Q: Is TARO stock a buy or sell?
A: The dominant strategy among neural network is to Hold TARO Stock.
Q: Is Taro Pharmaceutical Industries Ltd. Ordinary Shares stock a good investment?
A: The consensus rating for Taro Pharmaceutical Industries Ltd. Ordinary Shares is Hold and is assigned short-term Ba1 & long-term Ba1 estimated rating.
Q: What is the consensus rating of TARO stock?
A: The consensus rating for TARO is Hold.
Q: What is the prediction period for TARO stock?
A: The prediction period for TARO is (n+6 month)



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