Compustat variables - meaning of 0

[Quirine Anbeek]

When getting data from Compustat, I need the following variables. However, for some companies there is a 0 value in the following variables. 

What is the meaning of a zero value in the following?

Current liabilities

Total assets

Total debt

Stockholders equity

I am under the impression that a publically traded company with 0 total assets or 0 total debt (etc etc) does not make much of sense. Maybe the zero represents a convention?

Thanks in advance!

[Attila Balogh]

Hi Quirine,

 

It’s probably useful to understand the universe of firms that are included in Compustat. The below SAS code shows that not all firms are publicly listed and only a subset of them are listed on a large US exchange.

 

When firms go public, they also provide two or so years of prior financials, which could explain missing or zero values for firms on a large US exchange.

 

You may need to think about the sample of firms you are interested in studying and filter your sample accordingly. As a guideline, the smallest firm in the Russell 3000 has a market capitalization of just under $100m with a median of $1.4bn. It is probably a common first filter to exclude firms with total assets under $10m, or missing.

 

Attila

 

--

 

proc freq data=comp.funda;
        table exchg;
quit;

 

proc sort data=comp.r_ex_codes out=r_ex_codes;
   by exchgcd;
run;
proc print data=r_ex_codes;
   var exchgcd exchgdesc;
run;

 

https://www.ftserussell.com/research-insights/russell-reconstitution/market-capitalization-ranges

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