TenderAlpha Data Testing Guidelines: Forward-Looking Receivables & USD Obligations Feed
As a by-product of the Global Government Contracts Unified Data feed, TenderAlpha provides exact government contracts receivables up for obligation by the US government in the next 6, 12, 36 months and on a 5-year basis.
The historical data coverage is 12+ years back and the data could be monitored on a point- in-time basis.
For clients’ convenience, the government receivables data is matched against the ‘mirror backward-looking perspective’ of USD obligations made to date for the same time intervals, thus allowing easy comparison at any point in time.
Due to the transactional nature of US federal procurement, we can aggregate all outstanding payments under all live contracts per ticker as a point-in-time in our Forward-Looking Receivables & USD Obligations Feed.
We recommend testing for the Unexpected Government Receivables (UGR) signal. It was jointly-researched by BizPortal and Penn State University. It is used by the majority of TenderAlpha users with variations in trading models.
The UGR signal could be a strong abnormal stock returns indicator in three dimensions:
Dimension 1 - sudden or more gradual increase of USD receivables for traditional government suppliers (companies that are heavily dependent on government contracting) as compared to backward-looking USD obligations.
Furthermore, the receivables could also be modeled against earnings expectations.
Dimension 2 - a smaller company with an increase in any of the USD forward-looking receivables intervals (6, 12, 36, 60 months) that is material to the company’s last available revenue or any fundamental financial indicator.
The company can be either completely new to the procurement market and/or with insignificant previous backward-looking USD obligations. ‘
Dimension 3 - large-cap companies with insignificant or no previous USD obligations moving into the government market, as noticed by sudden or more gradual increase in forward-looking USD values.
Bear in mind that even if the value is low, the effect of a top stock entering the public procurement market could lead to positive sentiment and higher returns over a period of time.
Please be aware that the testing scenarios are standard and are by no means exhaustive. Upon request, we will provide you with a Data Dictionary for the Forward-Looking Receivables & USD Obligations Feed.
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