What Is the Institutional Brokers' Estimate System (IBES)?

The Institutional Brokers' Estimate System (IBES) is a database used by brokers and active investors to access the estimates made by stock analysts regarding the future earnings of publicly traded American companies. IBES is often written as "I/B/E/S."

Understanding the IBES

IBES serves as a central location for all current analyst estimates for stocks. It also incorporates company guidance, the estimates of projected future earnings that compa🧸nies publish on a quarterly and annual basis, and update periodically as needed.

The first iteration of the IBES database was created by a brokerage firm in 1976 and traded hands several times, landing at financial analytics firm Primark, before being purchased by 澳洲幸运5开奖号码历史查询:Thomson Reuters in 2000.

The database provides summary information and detailed projections gathered from analysts and brokers from the ma🧸jor international brokerages as well as local independent analysts. It draws on analyst estimates on performanc꧅e measures for companies across all industries. These include estimates of revenue, earnings per share, price targets, net debt, enterprise value, and net income, among other factors.

Users can break down data by year, by fiscal quarter, and by💯 other timeframes that are used to measure and anticiꦍpate a company’s performance.

The database includes recommendations from the analysts on whether to buy, hold, or sell shares in the public compaౠnies they cover.

How IBES Is Used

IBES aims to be a concise centralized system to aid in decision-making abouꦑt securities. It allows for access to a broader consensus estimate rather than relying on the narrow judgments that can be made from day to day as analysts publish their reꦿports.

IBES can be used in a variety of ways. Forecast models𝐆 for earnings per share results, for instance, can be created using IBES as a benchmark. The database also is used in accounting 🌼research.

IBES Spinoffs

Thomson Reuters has other distinct databases based on IBES. For example, IBES guidance data and earnings estimates are available to academics at the Wharton School of the University of Pennsylvania to review and evaluate expectations for companies. An IBES his🌼torical database is used to compare and test investment theories.

The IBES is one of a number of databases used by money manager🌃s and investors. The Center for Research on Security Prices has developed databases for stock prices including daily and monthly market information, research,ꦬ and historical data.

Advantages and Disadvantages of IBES

Pros of IBES

IBES aggregates earnings estimates from a wide array of sell-side analysts, including those from investment banks, brokerage firms, and other financial institutions. This extensive coverage spans various industries, sectors, and geographic regions, meaning there's a lot of different information available for many different purposes.

IBES consolidates analysts' earnings estimates into a single database. This saves investors time by acting as a centralized platform for getting forecasts and relevant information. It also provides stability and accessibility into historical earnings estimates and revisions.

IBES updates its database regularly with the latest earnings estimates, ensuring that investors have access to up-to-date information. You can consider IBES data to be near-real-time. Not only will you have quick access to information, IBES implements validation checks, data cleaning procedures, and verification o🀅f credentials to make sure any input data is correct.

Cons of IBES

IBES relies on earnings estimates provided by sell-side analysts. It's important to note that these folks may have biases or conflicts of interest, as they may be incentivized to maintain relationships with the companies they cover or their employers. This the data fed into IBES may be optimistic or pessimistic estimates that do not accurately reflect underlying fundamentals.

The specific methodologies used by in꧟dividual analysts to formulate their forecasts may not always be transparent. This lack of transparency can make it difficult for investors to assess the reliability and credibility of the estimates. Plus, even though there are data checks, IBES data may still be subject to errors or mistakes.

While IBES updates its database regularly, there may still be delays in reflecting analysts' revisions to earnings estimates. In an industry where everyone is fighting for the same information, having small lags in data accessibility may be detrimental. In addition, IBES may have limited coverage for smaller companies or companies in niche industries. You may not always have access to the specific information you're looking for.

The Bottom Line

IBES, or the Institutional Brokers' Estimate System, aggregates earnings estimates from sell-side analysts, providing comprehensive coverage across various industries. It offers investors timely access to consolidated and customizable data, aiding in informed decision-making and evaluation of market expectations.