Thursday IBM announced the acquisition of Clarity Systems, a sure sign that Big Blue thinks XBRL represents a large potential market. Clarity has been a successful provider of XBRL services to SEC-reporting companies.
EDGAR Online (EDGR) continues to be the only pure play on XBRL in the market today. The company not only has its own XBRL software solution but also its own proprietary XBRL-formatted database for virtually all SEC-reporting companies. This fact was recently made clear when the SEC announced that it had subscribed to EDGAR Online's XBRL US data-set. EDGAR Online's database covers over 10 years of SEC-reported data. And, the company has developed data-mining methods to capture data and incorporate that data into its own financial analytic tools.
Also, late yesterday afternoon, EDGR released its definitive proxy to acquire UBmatrix, the leading XBRL software company. UBmatrix povides XBRL software services to the FDIC, SEC and other regulators worldwide. UBmatrix also supplies its XBRL engine to Oracle (ORCL) and SAP (SAP) enterprise solutions.
With IBM's announcement, financial analysts just might start to look into potential XBRL market opportunities. As of today, however, there appears to be no other publicly traded company besides EDGAR Online that has a meaningful percentage of their revenue tied to XBRL and that also owns its own XBRL software solution.
Companies With Their Own XBRL Software Solution
- Thomson Reuters (TRI)
- Fujitsu (FJTSY.PK)
- Bowne (BNE) (subject to proposed acquisition by RR Donnelley (RRD))
- EDGAR Online (EDGR)
- Rivet Software (private)
- Clarity Systems (private) (acquired by IBM)
EDGAR Online's market cap is now only $33 million at its current market price of 1.25/share. 52-week range: 0.75 - 2.12. Earlier this year Bain Capital purchased a large, non-controlling stake in the company. Now, it appears that EDGAR Online has adequate capital to take advantage of XBRL market opportunities. Today the shares of EDGAR Online traded up 23.7% on over 8x its normal trading volume.
Note: Curiously, when I accessed the URL link above for EDGR's definitive proxy, I used Microsoft's MSN Money website. In doing that, I happened to see that the provider for MSN's SEC data is EDGAR Online. MSN, Yahoo, Google, Nasdaq, MarketWatch, etc. all use EDGAR Online for SEC filing data.
In late 2010 and 2011 there are three important market opportunities for EDGAR Online:
- The remaining 10,000 US companies reporting to the SEC must start filing their SEC Form 10-Qs and 10-Ks in the XBRL data format.
- Mutual funds have been mandated to report their SEC risk/return reports in XBRL starting in Dec. this year.
- In the U.K. company tax reports must be filed in iXBRL, and UBmatrix has a solution registered with HMRC.
Longer-term, there may be other markets that will use XBRL. For example, asset-backed securities, municipal bonds, corporate actions, and corporate proxy data might be appropriate areas where XBRL could add transparency to the financial markets.
Disclosure: Long EDGR
