Three university professors Felicia Marston of the University of Virginia, Christopher Malloy of London Business School, and Alexander Ljungqvist of New York University have called into question the integrity of a key resources for investors, Thomson Financial's IBES system. IBES, or Institutional Brokers' Estimate System, compiles estimates made by stock analysts and allows investors a central repository to review these estimates for a particular stock.

The issue with IBES, according to our three academics, involves unexplained retroactive changes to the data held in the system. In a paper published last month they noted four types of alterations that raise questions about the integrity of IBES's data, including: the removal of analyst names from past recommendations, the changing of recommendations from buy to hold, as well as after-the-fact additions to the system and wholesale deletions.

Did Thompson mishandle the data or did Marston, Malloy and Ljungqvist simple error in their analysis...check out this Slate article for further details on the now-controversial IBES System.

-- MDT

Labels: Alexander Ljungqvist, Christopher Malloy, Felicia Marston, IBES, Thomson Financial