Missing CUSIPs in Compustat
Posted: 26 January 2016 01:21 PM   [ Ignore ]
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Hi everyone,

I am currently working on my thesis in which I analyze abnormal returns in partial acquisitions based on different acquiror types. Therefore, I downloaded data on completed M&A deals between 1999 and 2013 from SDC (all of the targets are public).

In the following, I transformed the targets’ CUSIPs (6-digit) into 8-digit codes (by using Ali’s approach http://www.wrds.us/index.php/forum_wrds/viewthread/494/). With the 8-digit CUSIP codes I tried to download accounting data in Compustat. However, for about 30% of the targets’ CUSIPs, Compustat does not find any accounting data (it states that the CUSIP is unknown and no matches are found). I feel like converting the CUSIPs from 6 to 8-digits with the CUSIP tool in WRDS caused some issues. When searching for one of the 8-digit CUSIPs (e.g. 80281710) with the Code lookup tool in CUSIP subscriptions, it is available (target name: Santarus Inc). However, when searching for the same CUSIP in the Code lookup tool in Compustat or CRSP, it cannot be found.

Does anyone know why this is the case? I really would appreciate your help.

Thanks in advance,
Tobi

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Posted: 27 January 2016 10:27 AM   [ Ignore ]   [ # 1 ]
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hi Tobi,

Coincidentally, I’m currently also matching SDC with CRSP. First of all, I would think that matching on the first 6 digits of CUSIP would be ok. See breakdown of CUSIP here: https://www.cusip.com/cusip/about-cgs-identifiers.htm  (the first 6 indentify the firm).

I’m actually quite surprised that you find 70% of the targets in Compustat! How do you filter for public targets? I have downloaded all mergers from SDC over 1995-2015 (180,000 obs), and not filtering on targets, I find a match in CRSP for 34,000 of these. (I can match 77,000 acquirors).

In any case, CUSIP in Compustat is the header (=current) CUSIP, while CRSP has the historical CUSIP. I am assuming (and am not 100% sure) that SDC has historic CUSIP. In general, losing 30% between CRSP and Compustat sounds about right.

A quick question for you: did you find some documentation to choose between ‘acquiror CUSIP’ and ‘acquiror ultimate parent CUSIP’ (as well as ‘target CUSIP’ and ‘target ultimate parent CUSIP’)? (ultimate parent cusips give the best matches for me).

Best Regards,

Joost

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