I/B/E/S FOR ACADEMIC USERS

About I/B/E/S

Earnings expectations drive equity markets. Since 1971, I/B/E/S has been the premier supplier of earnings forecasts to investments professionals worldwide. As William Sharpe, Nobel Laureate says in his classic text Investments,

"While I/B/E/S is not the only company collecting earnings expectations data...it was the first and remains the leader in the field...The systematic collection of earnings estimates is an excellent example of the forces that have been increasing the efficiency of security markets. Before I/B/E/S collected such data, consensus earnings estimates were difficult to obtain and highly ambiguous. Now these estimates are rigorously quantified and widely distributed, decreasing the likelihood of investors acting on incomplete or erroneous information."

Academic Research Applications

For many years, I/B/E/S has supported academic research using earnings expectations. Hundreds of studies have been published using I/B/E/S data in prestigious academic journals such as The Journal of Finance and The Journal of Accounting Research as well as major practitioner journals such as The Journal of Portfolio Management, The Financial Analysts Journal and The Journal of Investing (for summaries, contact Florence Eng for a bibliography). The classic papers in this field were recently published in The Handbook of Corporate Earnings Analysis (Probus 1994). A recent conference devoted to the topic of earnings expectations featured presentations by several leading academic researchers. This topic has been and remains a fruitful area of published research, perhaps best summarized by Professor Lawrence Brown's "Earnings Forecasting Research: It Implications For Capital Market Research," in the International Journal of Forecasting.

Earnings expectations also drive the most widely used investment techniques of institutional investing. Merrill Lynch found in a 1994 study that more than half of their institutional clients - inside and outside the US - used earnings surprise, estimate revisions, forward P/E ratios and related techniques in their portfolio decision making process. Therefore, for students interested in investment careers, knowledge of earnings expectations has substantial practical value. Indeed some professors have found the investment value of their research so compelling that they have left academia altogether to pursue money management careers, e.g. Guerard, Levy, Jacobs.

Obtaining I/B/E/S Data For Academic Use

I/B/E/S makes its data available for academic use for a small fraction of the prices charged for commercial users. The I/B/E/S database can be licensed to a single researcher or for an entire university. A research proposal, a vita and a signed conditions statement are required. It is available in many formats including 9 track tapes, 8mm cartridges and CD ROM's. For details, please contact Florence Eng at telephone number, 212-647-5722, Internet address, feng@smtp.ibes.com or by fax at 212-727-1386.

In addition, I/B/E/S sometimes supports research that is particularly worthwhile. For example, in 1995 I/B/E/S is especially interested in world and international earnings estimates and in work using the analyst by analyst data. In 1996, I/B/E/S plans to sponsor a competition for outstanding papers in the field.