Back to the Future: Finding Historical Economic Forecasts

 

Business and economic forecasts that are past their shelf life, such as GDP forecasts for the year 2010 made in the year 2008,  might seem to be of little value.  But business researchers examine old forecasts to test their accuracy or to better understand the economic climate of a period. It is well known that forecasters almost universally missed predicting the “Great Recession” business decline of 2008/2009. For example,  The Economist’s  Poll of Forecasters for Jan 12, 2008 (pg. 89) predicted that U.S. GDP would increase 1.8% in 2008 and 2.6% in 2009.  GDP actually fell slightly in 2008 and was down 2.8% in 2009.

Here are some sources of historical forecasts that will let you exercise 20/20 hindsight.

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Smoking Out Cigarette Data with PASSPORT

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Sean Griffin from Euromonitor’s Passport GMID Database recently sent us a bulletin celebrating the Great American Smokeout. This is an annual event sponsored by the American Cancer Society designed to encourage people to quit smoking for 24 hours with the hope that the decision will be permanent. Sean uses the Passport database to examine smoking habits in the U.S. With his permission, we’ve adopted his examples and descriptions in the following post.

 

 

Smoking Habits

Smoking was much more accepted in the past.  For example, RJ Reynolds was a sponsor of The Flintstones in the early 1960’s.  Fred and Barney Rubble became spokestoons for Winston Cigarettes.  RJ Reynolds also went on to introduce the Joe Camel mascot to promote Camel cigarettes.  RJ Reynolds retired Joe Camel in 1997 after the campaign was criticized for influencing children to smoke,

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What’s it worth to you? Company Valuation Resources

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Contributors:  Cynthia L. Cronin-Kardon and Mia Wells

Valuation is used in business to determine the price participants are willing to pay or receive to buy or sell a business. Needless to say, the seller is looking to make as much profit on the deal as possible while the buyer hopes to pay as little as possible. Various resources can help determine the best price for the transaction. Listed below are some Lippincott Library resources to help students with assignments for a number of Wharton courses including FNCE207/728 – Corporate Valuation (which also has a course guide); FNCE250/750 – Venture Capital & the Finance of Innovation; and FNCE251/751 – Finance of Buyouts & Acquisitions.


 

Comparable Deals
You’ll want to search for precedent transactions in the industry of the company you are valuing. Several sources allow you to search for comps by industry (SIC code, NAICS code, or alphabetically by name).

BizComps is a database of business sale statistics which are based on small business sales transaction data. After searching by SIC or NAICS code, you’ll be presented with a list of recent deals. Select those of interest and you can run a “Transaction Analysis,” which will give summary statistics/multiples on the deals you’ve chosen. Ask to be logged in by a librarian at our Reference Desk.bizcompsborder

 

Business Valuations by Industry is a print source available at Lippincott Library ReferenceBusValIndusMerged Desk (call number HG4028.V3 B78). It includes detailed studies of actual mergers and acquisitions, including deal “tearsheets”. This source is arranged by industry and includes actual transactions from 2007 through 2009. Profiles of buyers are included as well as some some foreign transactions and deal terminations. This is a great resource when you want to profile selected, covered deals.

 

 

 

Betas
Beta measure the volatility of an industry or company within the market as a whole. Betas help to calculate the risk of an investment.

Industry BetasFor industry betas, use the Ibbotson SBBI Valuation Yearbook, a print guide held at our Reference Desk (call number HG4028.V3 S86).

 

companybetaCompany betas are in Bloomberg, available in the Yablon Financial Resources Lab here in Lippincott, or the Forum level of Huntsman Hall. Search for a company of interest and run the Beta function by typing BETA <Go>.

 

 

Best practices
It’s always smart to look to the experts for advice – these sources will give you tips and tricks when performing a valuation for a company within a certain industry.

BusRefGuidemerge
Business Reference Guide is a print source located at Lippincott Library Reference Desk (HD1393.25 .B87). This source provides several types of information which can be used for pricing businesses and franchises.  It is organized by industry and includes industry statistics from IBISWorld, “rules of thumb” by industry analysts, pricing tips, benchmarks, commentary, expenses as a percentage of annual sales and industry costs.

 

 

Standard & Poor’s Net Advantage provides industry surveys. One unique feature of this source the section included for every industry on “How to Analyze a Company in this

S&PIndustry”. To access this, click on Industries, select the survey of interest. Next scroll to the chapter titled, “How to Analyze a(n) […] Company,” which also contains a section on Equity Valuation as well as a glossary of industry terminology.

 

 

 

Company multiples
To track multiples of a company over time, use the sources listed below. This will help you price out the company itself or help you to compare it against a similar firm.

Multiples_VinceS&P Capital IQ provides lots of financial data including multiples. MBAs can access CapIQ via MBA Career Management, while Wharton undergraduates can come to the Yablon Financial Resources Lab and ask to be logged in by a librarian. Search for a public company of interest and look for Financials/Valuation in the left menu. You can change the date range to see multiples over time, as well.

 

BloomFA

Bloomberg is available in the Yablon Financial Resources Lab or the Forum level of Huntsman Hall. Search for a company of interest and run the Financial Analysis function by typing FA <Go>. Look for the Enterprise Value tab.

 

Past M&A deal tearsheets
You may find it helpful to look for past deals to get a sense of how many deals a company has done in the past, what were the specifics of a deal or how active the M&A market is in a certain industry.

Thomson ONE – note that this resource only loads with full functionality when using Internet Explorer. Once inside, scroll over Screening & Analysis, then Deals & League Tables, then M&A to select either a Quick Search or Advanced Search.

Zephyr – select Zephyr Advanced. Pick the variables to define your search. Below is a screenshot of a list of deals. You can click on any of these to get a detailed summary of the deal.Zephyr

This post may have additional information – What’s the Deal? Researching Specific M&A Deals

 

 

 

 

Living the Dream: Researching the Fantasy Sports Services Industry using resources available to Wharton students

In the U.S., Fantasy Sports Services comprise a billion dollar industry with hundreds of component companies . Like many new industries consisting mainly of small private companies, data on the industry and its companies is allusive. Similar problems are encountered in researching such industries as Tattoo Parlors, Online Dating  and Mobile Apps.

The Lippincott sources for Wharton students described below will give you a good start in researching the Fantasy Sports industry and its companies

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$1000s in Free Market Research—At the Library!

This post originally appeared in Wharton Entrepreneurship’s Blog:

As an entrepreneur on campus, you will be impressed and excited by the types of resources the library provides. Are you looking for trade journals to read to develop ideas; industry research to learn about sectors; demographics databases to identify customers; company directories to create a list of possible competitors; financial benchmarks to draft projections; or deal summaries to understand the funding climate? The library can help! We strive to purchase resources used across academic and corporate settings, including more than 120 business related databases, most of which are available to students, faculty and staff of Penn with their PennKey and password, anywhere they have an internet connection, through the library website.

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With so many resources, it can be daunting to know where to start! Fortunately, we’ve built in some help from theLippincott Library home page. Our Research Guides are authored by our business librarians and organized by topic. Our Business FAQ offers quick answers to commonly asked questions.  But the absolute best way to learn how to navigate our resources is to contact my colleagues and me at Lippincott Library. Send us an email at lippinco@wharton.upenn.edu, call us at 215-898-5924, chat with us, stop by the library, or visit us in Huntsman in GSR 251 from 12:30 to 1:30pm, Mondays through Thursdays during the semester. We can direct you to library assets most relevant to your topic, provide instruction on effective database searching and assist you in developing a strategy to find what you want.

Do you want to scour the NY Times and the Wall Street Journal every day to track trends and news? You can do that with Factiva.

Do you want to read trade journals about the beverage industry because you are interested in launching a kombucha tea business? You can do that with Business Source Complete.

Do you want to get an overview of demographics and spending behavior of America’s pet owners? You can do that with Mintel.

Do you want to get perspective on remote patient monitoring systems? You can do that with Marketresearch.com Academic. And yes, you are reading that correctly. That report is valued at $4200, and you have access because you are affiliated with Penn.

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The resources available through the Penn Libraries are vast. Save yourself time, and contact us to explore valuable information to develop your entrepreneurial ideas. You will wonder why you didn’t talk to us sooner!

Please see our Research Guide, Entrepreneurship and Small Business for additional resources.

MSCR – Bloomberg’s Municipal Bond Screening Function

Bloomberg’s MSCR function allows you to search a file of more than a million outstanding municipal bonds based on criteria of your choice.

The main search screen shows a search for bonds issued by Philadelphia institutions of higher education.

msrc screen ok

The spreadsheet below gives a page of the resulting list using the default headings. A 154.75 million dollar bond by the University of Pennsylvania is highlighted. Clicking on a row in the spreadsheet allows the display of additional bond details.

Univ PA lisrt

The first page of a description of the Penn Bond is shown.

Penn bond detail

The columns in the output can be edited. For example, for a spreadsheet showing the bonds issued by municipalities with a Moody’s rating of below investment grade (Ba1 to C) we would want a column showing the Moody rating associated with each bond.  Search variables are not automatically added as columns in the display. To add a column or columns, follow this sequence:

Actions => Edit => Display

Choose variables wanted and click APPLY

For more on Bloomberg’s functions, take a look at the blogs in our Bloomberg category and our Bloomberg Help Guide.

A Few WRDS about the S&P 500

The Standard and Poor’s 500 Index, a key measure of the U.S. equity market, closed above 2,000 the first time on August 26, 2014.The Index includes 500 leading U.S. companies and captures about 70% of available U.S. market capitalization.

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Standard & Poor’s OUTLOOK

The S&P 500 Index first appeared in March 1957. Described as “The Standard 500” in the OUTLOOK (March 11, 1957, p.908) S&P mentioned the “intricate computing equipment applied to the task” of calculating the Index every hour. Today, the Index is calculated every 15 seconds.

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Standard & Poor’s Security Price Index Record

Oddly enough, S&P didn’t list the stocks that composed the Index in the OUTLOOK. You can find the initial list of 500 companies scattered among the 91 industry subgroups that made up the Index in Standard & Poor’s Security Price Index Record for 1957. For the subgroup “Confectionery”, for example, the 500 component companies were American Chicle, Hershey Chocolate, Sweets, and Wrigley (p. 29). The Index has undergone many changes since its inception, both in the companies that compose it, and in the way that it is calculated. Currently, only 86 of the original 500 companies are still part of the Index.

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Corporate Affiliations and ReferenceUSA’s “Way Back” Machines

Web-based company directories have many advantages over their print counterparts, but in one area they frequently fall short; they rarely include historical information. Financial databases of public companies such as Bloomberg, Thomson One, and S&P COMPUSTAT will include extensive historical financial data, but if you are looking for a private company’s address, product line, or executive names as of 1995, you would do better with a 20 year run of a printed directory than with its current online counterpart.  This pattern is changing as information vendors become aware of the market for historical company data. Two examples of corporate directory archives are the historical research sections of Corporate Affiliations and ReferenceUSA.

Corporate Affiliations shows the corporate structure of more than 1 million public and private companies world-wide with subsidiary listings and corporate linkage.  For more information please see:  Private Company Research Part 2:  Corporate Affiliations. The Historical Research module of the database gives company addresses, products, SIC numbers, names of executives and directors, and key financial data for every year from 1993 to date. As the menu below indicates, you can search by company name, or screen by one or more variables. A company (ENRON, for example) does not have to be in business currently to be included in the historical file. To reach the Historical Search menu, follow this path from the main Corporate Affiliations’ menu:

Subscriber Tools => Historical Search

Corp Affiliations History First Menu

 

 

 

 

The record for Motorola Solutions, Inc. shows how the data is presented for a single company.  Clicking on the date tabs (‘1993’ etc.) will include the data for that year in the output.

Corp Affiliations Historical 1

 

The historical treatment of changes in SICs and product descriptions will include as many as 14 SIC numbers and descriptions for each company.

Corrp Ailliations Historical 2

 

 

 

 

 

The company record for all years and all variables can be downloaded as a text .CSV format which EXCEL will read.

Here is the result of a screen for companies in Philadelphia in 1993.

Corp affiliation Phila

 

The WEB display of the results is only a small fraction of the EXCEL record, which will give details for all variables (SIC, executive name, financial data, etc.). If the entire date range is requested, the downloaded record will list the companies alphabetically and then give variable details for each year.

However, there is a display limit of 1,000 records per search.  For example, a search for all companies in France with data for all years will produce a set of more than 1,000 records, but only 1,000 records from the set will be displayed.

ReferenceUSA’s current company directory contains 24 million U.S. company records plus records for an additional 1.5 million Canadian companies. The database’s historical businesses  module contains 151 million U.S. company records from 2003 through 2013.

To see the menu below:

U.S. Historical Business Database => Custom Search

REfUSA Main Menu

 

 

 

 

 

 

REFUSA beer list 2003

For example, a screen for breweries (Primary NAICS 312120)  in Pennsylvania in 2003 will produce this display:

 

Clicking on an individual company name will display a record giving the 2003 address, phone, sales volume, employee size, SIC/NAICS codes, as well as graphs of sales volume and number of employees for all available years between 2003 and 2013.

Downloading the records in  EXCEL and requesting “detail” will display all the variables available for the company for the given year. However, there is a limit of 250 records per download.  Requesting all records for a company for the range of years (2003 – 2013) will give a line of data for each year. In this way, you can determine if a company changes its name during the ten year period. For example, the company listed as “Pittsburgh Brewing”  from 2003-2008 is listed as “Iron City Brewing” between 2009 and 2012 and then as “Pittsburgh Brewing” again in 2013.

Companies can be mapped by number of locations, employee or sales size and displayed as “heat maps”. For example, the heat maps below show the doubling of  the number of breweries in Pennsylvania  between 2003 and 2013 (from 27 locations to 69).

CombinedHeat

The  availability of  the “back files” of ReferenceUSA and Corporate Affiliations are an important step in filling the gap in digital historical directory information.

For additional information on company histories see this posting: Don’t Know Much About “Corporate” History.

Also see our Research Guides:  Company Information and Business History Resources.

 

Put our Services to the Test

Welcome to Lippincott and the start of a new academic year!  We have a number of services to help make your life at Penn a lot easier.  Some of these services are described here.

 

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DOCUMENT DELIVERY. Available to MBAs,  PhD candidates and Faculty. Please send an email to docdel@wharton.upenn.edu to request articles and book chapters. Include the full citation for the fastest reply.

BUSINESS FAQ.  Your 24/7 librarian. Search by keyword to find resources on your topic such as financial ratios, consumer demographics, analyst reports and many more.

RESEARCH ASSISTANCE.  Email us, chat, call us at 215-898-5924 or contact a subject specialist on your topic. Ask for a Consultation for yourself or your team. We know where to find the academic resources that you need.

WHARTON LAB COMPUTERS AND PRINTERS.  Too crowded over at Wharton?  Come over to Lippincott and use the Wharton Lab Computers here.  These computers are reserved for Wharton students and have all the same programs and features that are available on Wharton computers.  Sign in using your Wharton account information.

GROUP STUDY ROOMS.  Have a team project or group presentation?  Reserve a room  for your meeting.  Some rooms are larger and can accomodate up to 12 people.

YABLON FINAYablon 1NCIAL RESOURCES LAB.  Bloomberg and Capital IQ are at your fingertips.  Log in with your Wharton account information.  First time you use Bloomberg, create your own account.  Librarians log you into Capital IQ.

 

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DATAPOINTS is the Lippincott Library’s blog. Follow us to learn tricks and tips about Bloomberg and many other Library databases.  Look for postings on new Library resources.  See this post, for example: Top 10 Resources for MBAs .

WORKSbloomberg120611_2_560HOPS.  Wednesdays are Bloomberg days.  Every week we provide Bloomberg training from 3:30 – 4:30 in the Yablon Financial Resources Lab.  You can register here: Business Workshops.   It’s hands-on so be sure to come a few minutes early to create your own Bloomberg account.

We also offer other workshops on Job Search, Company Information and Business Research Skills.  See the training schedule to find out what workshops are being offered. Registration is recommended.

RESEARCH TO GO.  Every Monday -Thursday we come to you.  Reference Librarians are available from 12:30 – 1:30 in Huntsman Hall 251.  Drop in and get fast answers to your job search or research questions.8-27-2014 2-49-11 PM

TEXT BOOKS.  Available for many Wharton courses at the Lippincott Reserve Desk.  Most can be checked out for three hours and used in the Library.

 

SUBJECT/COURSE GUIDES.  Subject Specialist have prepared Guides by subject area or course.  Use these to find resources for your projects and assignments.  Contact a Specialist for additional information.

FRANKLIN is the Library Catalog.  Use this to search for books, journals, videos and more.

MARK’S CAFE.  Food.  Drink.  Comfort.

Take advantage of the services available to you.  Hope to see you soon.

 

 

 

 

 

 

 

 

Bloomberg’s PE: A Major Database for Private Equity

Private equity consists of firms and funds that make investments directly into private companies or conduct buyouts of public companies. Private equity, as the name implies, is not traded on public equity exchanges.PE bloomberg FIRST MENU

Bloomberg’s Private Equity (PE) database brings together data about PE firms, funds, investors and portfolios. In Bloomberg, type PE <GO> for this menu:

 

 

Search by Firm – Private equity firms are the general partners controlling the operations of the firm.

Search by Fund – Private equity firms direct their investments through one or more funds. Funds are associated with a specific investment strategy.  Venture Capital Funds, for example, are investments in startup firms and small businesses with perceived long-term growth potential. Here is a breakdown of the funds worldwide associated with a specific strategy that is available in Bloomberg.

Strategy           Percent of Total

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  • Venture              28%
  • Buyout               25%
  • Growth                9%
  • Debt                    8%
  • Fund of Funds   10%
  • Real Estate        13%
  • Other                   8%

Search by Limited Partners – Limited partners are the source of investment funds. They include public and corporate pension funds, insurance companies, endowments, high net worth individuals, and sovereign wealth funds

Search by Deal – Deals can be classified as M&A investment, Joint venture, Spinoff, and Buyback, and then further sub classified as a PE buyout, Infrastructure, Real Asset, Real Estate, Secondary Transaction, or Venture Capital deal. Venture Capital deals include possible subdivisions into Seed, Angel, or Series (A to J).

The screen below shows a search for all PE deals in the past year that had targets in the alternative energy industry.

PE bloom deal screen for alternative eng 417

 

Search by Private Company – Bloomberg lists more than 15,000 companies in which PE firms invest.

  • Clicking on the name of the company will display a record giving the name(s) of the PE firms which include the company in their portfolio, as well as additional information about the company. The record for U.S. Foods, for example, will show that it is held by KKR 2006 Fund.

In addition to its list of PE backed private companies, Bloomberg includes a database of 1.3 million private companies worldwide that are not PE backed.

PE Bloom Private compnay ALL OKOther useful features of Bloomberg’s PE include Funds in Market, which gives aggregate statistics by strategy, and Benchmarking and Fund Comparison, which allow the comparison of funds by such features as IRR (internal rate or return).

Take a look also at Bloomberg’s weekly Private Equity Brief

PE Bloomberg Brief banner

PE Bloom table from PE brief

In addition to Bloomberg, the Penn Libraries have several additional databases that provide details of private equity activity. They include Thomson ONE, S&P Capital IQ (available at Lippincott in the Yablon Financial Resources Lab) , Preqin, and CB-Insights.

Also see our Research Guide:  Venture Capital and Private Equity.

For more information on Bloomberg see our Bloomberg Help Guide and additional posts in Datapoints under the Category:  Bloomberg.