Currency Apparently Still Affecting EPS Estimates

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1

This is sort of a follow on the discussion thread located here: https://www.portfolio123.com/mvnforum/viewthread_thread,5604#26357

I am still having anomalous earnings estimates enter my stock screens. On top of the fact that many analysts do not submit GAAP estimates (and it would be good to have a way to figure which type “earnings” are being forecasted (e.g., “FFO”, “FCF”, “EBIT”, “EBITDA”, “GAAP EPS”, “non-GAAP EPS”, etc…)), it appears as though P123 is still having issues with converting EPS estimates to USD.

For example, today on 7/30/2014, I screened for value stocks and found the following:

NVO:

  • Domicile: Denmark
  • Currency Coversion (1 USD): 5.57 Danish Krone
  • Current FY EPS (P123): 10.28
  • Next FY EPS (P123): 11.45
  • Current FY EPS (Yahoo): 1.84
  • Next FY EPS (Yahoo): 2.06
  • Notes: Currency conversion explains the delta

QIWI:

  • Domicile: Russian Federation
  • Currency Coversion (1 USD): 35.73 Russian Ruble
  • Current FY EPS (P123): 54.71
  • Next FY EPS (P123): 70.23
  • Current FY EPS (Yahoo): 1.55
  • Next FY EPS (Yahoo): 1.96
  • Notes: Currency conversion explains the delta

GOMO:

  • Domicile: PRC
  • Currency Coversion (1 USD): 6.17 Chinese Yuan
  • Current FY EPS (P123): 3.94
  • Next FY EPS (P123): 6.27
  • Current FY EPS (Yahoo): .62
  • Next FY EPS (Yahoo): .99
  • Notes: Currency conversion explains the delta

JOBS:

  • Domicile: PRC
  • Currency Coversion (1 USD): 6.17 Chinese Yuan
  • Current FY EPS (P123): 19.85
  • Next FY EPS (P123): 23.23
  • Current FY EPS (Yahoo): 2.79
  • Next FY EPS (Yahoo): 3.19
  • Notes: Currency conversion explains the delta

I can easily find other examples where currency conversion issues clearly explain the delta between EPS Estimates and Fundamental Data. While I can use common sense to sort out the currency issues out on case-by-case basis, this is really aggrevating because I don’t know how much this issue is affecting backtests.

If fundamental and price data is in USD, estimates should be in USD. If fundamental and price data is in the native currency, then estimates should be in the native currency. Being able to programmatically determine that currency is of tertiary importance to internal consistency within the data.

2

Investigating. Thanks

3

primus,

To get around this problem I had changed to only use ratios of current estimates and 1 year earlier estimates because the ratio is the same before or after currency conversion.

Denny :sunglasses:

4

I found the problem. The estimates for foreign companies is correct prior to 3/8/14. Since then we were snapshotting the latest values but we were using a currency rate for today’s date. Since the update runs twice , once before midnight and once after midnight, the second pass was not able to pick up a currency conversion as it does’t yet exist, and over-wrote the correct value with an un-adjusted value.

I’m re-building the estimates since 3/8/14 to today right now. All should be ok tonight.

Very sorry about this, and thank you for reporting it.

5

Thank you, Marco. Customer service is why I stay with P123.