Modelling A.I. in Economics

Is LON:PNN Stock Buy or Sell?

Outlook: PENNON GROUP PLC is assigned short-term Ba1 & long-term B1 estimated rating.
AUC Score : What is AUC Score?
Short-Term Revised1 :
Dominant Strategy : Speculative Trend
Time series to forecast n: for Weeks2
Methodology : Statistical Inference (ML)
Hypothesis Testing : ElasticNet Regression
Surveillance : Major exchange and OTC

1The accuracy of the model is being monitored on a regular basis.(15-minute period)

2Time series is updated based on short-term trends.


PENNON GROUP PLC prediction model is evaluated with Statistical Inference (ML) and ElasticNet Regression1,2,3,4 and it is concluded that the LON:PNN stock is predictable in the short/long term. Statistical inference is a process of drawing conclusions about a population based on data from a sample of that population. In machine learning (ML), statistical inference is used to make predictions about new data based on data that has already been seen.5 According to price forecasts for 1 Year period, the dominant strategy among neural network is: Speculative Trend

Graph 51

Key Points

  1. Statistical Inference (ML) for LON:PNN stock price prediction process.
  2. ElasticNet Regression
  3. Can stock prices be predicted?
  4. What is a prediction confidence?
  5. Buy, Sell and Hold Signals

LON:PNN Stock Price Forecast

We consider PENNON GROUP PLC Decision Process with Statistical Inference (ML) where A is the set of discrete actions of LON:PNN 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

Sample Set: Neural Network
Time series to forecast: 1 Year

According to price forecasts, the dominant strategy among neural network is: Speculative Trend

F(ElasticNet Regression)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(Statistical Inference (ML)) X S(n):→ 1 Year e x rx

n:Time series to forecast

p:Price signals of LON:PNN stock

j:Nash equilibria (Neural Network)

k:Dominated move of LON:PNN stock holders

a:Best response for LON:PNN target price

Statistical inference is a process of drawing conclusions about a population based on data from a sample of that population. In machine learning (ML), statistical inference is used to make predictions about new data based on data that has already been seen.5 Elastic net regression is a type of regression analysis that combines the benefits of ridge regression and lasso regression. It is a regularized regression method that adds a penalty to the least squares objective function in order to reduce the variance of the estimates, induce sparsity in the model, and reduce overfitting. This is done by adding a term to the objective function that is proportional to the sum of the squares of the coefficients and the sum of the absolute values of the coefficients. The penalty terms are controlled by two parameters, called the ridge constant and the lasso constant. Elastic net regression can be used to address the problems of multicollinearity, overfitting, and sensitivity to outliers. It is a more flexible method than ridge regression or lasso regression, and it can often achieve better results.6,7


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

How do Predictive A.I. algorithms actually work?

LON:PNN Stock Forecast (Buy or Sell) Strategic Interaction Table

Strategic Interaction Table Legend:

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%

Financial Data Adjustments for Statistical Inference (ML) based LON:PNN Stock Prediction Model

  1. The underlying pool must contain one or more instruments that have contractual cash flows that are solely payments of principal and interest on the principal amount outstanding
  2. If the group of items does have offsetting risk positions (for example, a group of sales and expenses denominated in a foreign currency hedged together for foreign currency risk) then an entity shall present the hedging gains or losses in a separate line item in the statement of profit or loss and other comprehensive income. Consider, for example, a hedge of the foreign currency risk of a net position of foreign currency sales of FC100 and foreign currency expenses of FC80 using a forward exchange contract for FC20. The gain or loss on the forward exchange contract that is reclassified from the cash flow hedge reserve to profit or loss (when the net position affects profit or loss) shall be presented in a separate line item from the hedged sales and expenses. Moreover, if the sales occur in an earlier period than the expenses, the sales revenue is still measured at the spot exchange rate in accordance with IAS 21. The related hedging gain or loss is presented in a separate line item, so that profit or loss reflects the effect of hedging the net position, with a corresponding adjustment to the cash flow hedge reserve. When the hedged expenses affect profit or loss in a later period, the hedging gain or loss previously recognised in the cash flow hedge reserve on the sales is reclassified to profit or loss and presented as a separate line item from those that include the hedged expenses, which are measured at the spot exchange rate in accordance with IAS 21.
  3. For the purpose of determining whether a forecast transaction (or a component thereof) is highly probable as required by paragraph 6.3.3, an entity shall assume that the interest rate benchmark on which the hedged cash flows (contractually or non-contractually specified) are based is not altered as a result of interest rate benchmark reform.
  4. Annual Improvements to IFRS Standards 2018–2020, issued in May 2020, added paragraphs 7.2.35 and B3.3.6A and amended paragraph B3.3.6. An entity shall apply that amendment for annual reporting periods beginning on or after 1 January 2022. Earlier application is permitted. If an entity applies the amendment for an earlier period, it shall disclose that fact.

*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.

LON:PNN PENNON GROUP PLC Financial Analysis*

Rating Short-Term Long-Term Senior
Income StatementBaa2B3
Balance SheetBaa2Baa2
Leverage RatiosBaa2Baa2
Cash FlowBaa2Caa2
Rates of Return and ProfitabilityCC

*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?


  1. Lai TL, Robbins H. 1985. Asymptotically efficient adaptive allocation rules. Adv. Appl. Math. 6:4–22
  2. M. Petrik and D. Subramanian. An approximate solution method for large risk-averse Markov decision processes. In Proceedings of the 28th International Conference on Uncertainty in Artificial Intelligence, 2012.
  3. J. Hu and M. P. Wellman. Nash q-learning for general-sum stochastic games. Journal of Machine Learning Research, 4:1039–1069, 2003.
  4. S. Proper and K. Tumer. Modeling difference rewards for multiagent learning (extended abstract). In Proceedings of the Eleventh International Joint Conference on Autonomous Agents and Multiagent Systems, Valencia, Spain, June 2012
  5. Jorgenson, D.W., Weitzman, M.L., ZXhang, Y.X., Haxo, Y.M. and Mat, Y.X., 2023. S&P 500: Is the Bull Market Ready to Run Out of Steam?. AC Investment Research Journal, 220(44).
  6. F. A. Oliehoek and C. Amato. A Concise Introduction to Decentralized POMDPs. SpringerBriefs in Intelligent Systems. Springer, 2016
  7. Alexander, J. C. Jr. (1995), "Refining the degree of earnings surprise: A comparison of statistical and analysts' forecasts," Financial Review, 30, 469–506.
Frequently Asked QuestionsQ: What is the prediction methodology for LON:PNN stock?
A: LON:PNN stock prediction methodology: We evaluate the prediction models Statistical Inference (ML) and ElasticNet Regression
Q: Is LON:PNN stock a buy or sell?
A: The dominant strategy among neural network is to Speculative Trend LON:PNN Stock.
Q: Is PENNON GROUP PLC stock a good investment?
A: The consensus rating for PENNON GROUP PLC is Speculative Trend and is assigned short-term Ba1 & long-term B1 estimated rating.
Q: What is the consensus rating of LON:PNN stock?
A: The consensus rating for LON:PNN is Speculative Trend.
Q: What is the prediction period for LON:PNN stock?
A: The prediction period for LON:PNN is 1 Year
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