FactSet
FDS
$254.36
+4.26%
FactSet Research Systems provides financial data, analytics, and portfolio management solutions to the global investment community, aggregating data from exchanges, brokerages, and third-party suppliers into its workstations. As a leading provider of financial information and analytics, FactSet competes with Bloomberg and Refinitiv, serving buy-side clients (over 80% of annual subscription value) including wealth managers and corporations. The current investor narrative centers on FactSet's ability to sustain mid-single-digit revenue growth amid a challenging macro environment, with attention on margin expansion from cost efficiencies and the integration of recent acquisitions like CUSIP Global Services, while the stock has declined nearly 40% over the past year, raising debates about valuation and competitive positioning.…
FDS
FactSet
$254.36
Related headlines
Investment Opinion: Should I buy FDS Today?
Rating: Hold. Thesis: FactSet is a high-quality, mature business with strong cash flows, but its decelerating growth and margin compression limit upside, making it a hold until clearer signs of stabilization emerge. The analyst consensus is Hold with an average target of $255.06, implying minimal upside.
Supporting Evidence: FactSet's forward PE of 12.9x is attractive relative to its five-year average of 30x, but the trailing PE of 23.7x is a 7.7% premium to the industry. Revenue growth of 6.4% is below the industry median of ~8-10% for data providers. Net margin of 25.7% is strong, but operating margin declined 650 bps YoY. Free cash flow yield of 5.0% provides a floor, but the stock has underperformed the S&P 500 by 56.1% over one year.
Risks & Conditions: The Hold rating would upgrade to Buy if revenue growth accelerates above 8% or operating margins recover above 30%, or if the stock pulls back to the $210 area (analyst low target). It would downgrade to Sell if revenue growth falls below 4% or margins continue to compress. Overall, FactSet appears fairly valued relative to its growth and margins, trading at a slight premium on PE but a discount on PS (6.1x vs. industry 8.0x).
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FDS 12-Month Price Forecast
FactSet is a neutral outlook given the balance between cheap valuation and fundamental headwinds. The stock's forward PE of 12.9x is compelling, but the decelerating growth and margin compression justify the market's skepticism. The base case of 5-6% growth and stable margins is most likely, keeping the stock range-bound. An upgrade to bullish would require evidence of margin stabilization or growth acceleration, while a downgrade to bearish would follow further deterioration in fundamentals.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on FactSet's 12-month outlook, with a consensus price target around $255.06 and implied upside of +0.3% versus the current price.
Average Target
$255.06
0 analysts
Implied Upside
+0.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$210 - $340
Analyst target range
FactSet is covered by 16 analysts, with a consensus recommendation of 'Hold' (mean recommendation of 3.33 on a 1-5 scale where 1 is Strong Buy and 5 is Strong Sell). The distribution shows a mix of ratings: 1 Buy (UBS), 6 Hold/Equal Weight/Market Perform, and 3 Underperform/Underweight (Barclays, B of A Securities, Wells Fargo). The average target price is $255.06, implying a modest 0.3% upside from the current price of $254.36. The consensus leans neutral to slightly bearish, reflecting uncertainty about the company's growth trajectory and competitive position.
The target price range spans from a low of $210.00 to a high of $340.00, representing a 61.9% spread between the low and high. The high target of $340.00 implies 33.7% upside and likely assumes a successful turnaround with margin expansion and revenue acceleration from new products. The low target of $210.00 implies 17.4% downside and prices in continued margin compression, competitive losses, or a recession impacting subscription renewals. Recent ratings actions (as of July 2-6, 2026) show no changes, with firms like Barclays, Morgan Stanley, and BMO Capital maintaining their existing ratings. The wide target spread indicates high uncertainty among analysts, which is typical for a stock undergoing a transition. The lack of recent upgrades or downgrades suggests the market is in a wait-and-see mode, awaiting clearer signals on FactSet's ability to stabilize growth and margins.
Bulls vs Bears: FDS Investment Factors
FactSet presents a mixed picture: strong profitability and cash flow contrast with decelerating growth and margin compression. The bull case rests on the stock's cheap forward PE (12.9x) and high FCF yield, suggesting value if earnings stabilize. The bear case focuses on slowing revenue growth (6.4%), operating margin decline (from 33.2% to 26.7%), and analyst skepticism (Hold consensus, 0.3% upside). The single most important tension is whether FactSet can stabilize margins and re-accelerate growth to justify its current valuation, or if competitive pressures and a mature industry will lead to further multiple compression. Currently, the bearish evidence is slightly stronger given the lack of near-term catalysts and analyst caution.
Bullish
- Attractive Forward PE Valuation: The forward PE of 12.9x is near historical lows and well below the five-year average of ~30x, suggesting the market has priced in pessimistic expectations. If earnings stabilize, multiple expansion could drive significant upside.
- Strong Free Cash Flow Generation: Trailing twelve-month free cash flow is $708.3 million, representing a 5.0% FCF yield. This cash generation supports share buybacks ($203.1M in Q3 FY2026) and a 1.1% dividend yield, providing a floor for the stock.
- High Profitability with 25.7% Net Margin: FactSet's net margin of 25.7% is well above the industry average of 20%, reflecting its subscription-based model and pricing power. ROE of 27.3% indicates efficient capital use.
- Recent Price Recovery from Lows: The stock has rallied 17.5% over the past month and 13.5% over three months, outperforming the S&P 500 by 16.7% and 10.0% respectively. This could signal a bottoming process.
Bearish
- Revenue Growth Decelerating to 6.4%: Q3 FY2026 revenue grew only 6.4% YoY, and sequential growth was just 1.9%. This mature, subscription-based business lacks acceleration catalysts, limiting earnings upside.
- Operating Margin Compression: Operating margin fell to 26.7% in Q3 FY2026 from 33.2% a year ago, driven by higher operating expenses. This trend could persist if competition forces continued investment.
- Analyst Consensus is Hold with Limited Upside: The average analyst target of $255.06 implies only 0.3% upside from the current price of $254.36. The consensus recommendation is Hold, with three Underperform ratings from Barclays, BofA, and Wells Fargo.
- Stock Down 39.6% Over the Past Year: Despite the recent rally, FDS has underperformed the S&P 500 by 56.1% over one year. The sustained downtrend and 52-week low of $185.00 highlight persistent negative sentiment.
FDS Technical Analysis
FactSet is in a sustained downtrend, with the stock price declining 39.6% over the past year, significantly underperforming the S&P 500's gain of 16.5%. The current price of $254.36 sits at 29.5% of its 52-week range ($185.00 low to $424.62 high), indicating the stock is trading near the lower end of its range. This positioning near the 52-week low suggests the market has priced in significant negative sentiment, but also presents a potential value opportunity if fundamentals stabilize. The stock's beta of 0.715 implies it is less volatile than the market, which may offer some downside protection but also limits upside participation in rallies.
Short-term momentum shows a conflicting picture: the 1-month price change is +17.5%, while the 3-month change is +13.5%, both contrasting sharply with the 1-year decline of -39.6%. This divergence suggests a potential short-term recovery or mean reversion attempt, but the 6-month change of -11.3% indicates the broader downtrend remains intact. The relative strength versus the S&P 500 over 1 month is +16.7%, confirming recent outperformance, but the 1-year relative strength is -56.1%, highlighting persistent weakness. The recent price surge from the June low of $208.84 to $254.36 could be a relief rally within a bear market, and traders should watch for confirmation of a trend reversal.
Key support is at the 52-week low of $185.00, a breakdown below which would signal further downside and potentially test lower levels. Resistance is at the 52-week high of $424.62, a breakout above which would indicate a major trend reversal. The stock's beta of 0.715 suggests it is 28.5% less volatile than the S&P 500, meaning it may not participate fully in market rallies but could also decline less during selloffs. The current price is 37.5% below the 52-week high, and a move above the recent high of $270.85 (June 1) would be a positive near-term signal.
Beta
0.71
0.71x market volatility
Max Drawdown
-57.8%
Largest decline past year
52-Week Range
$185-$419
Price range past year
Annual Return
-39.6%
Cumulative gain past year
| Period | FDS Return | S&P 500 |
|---|---|---|
| 1m | +17.5% | +1.4% |
| 3m | +13.5% | +3.3% |
| 6m | -11.3% | +6.3% |
| 1y | -39.6% | +16.0% |
| ytd | -10.7% | +8.4% |
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FDS Fundamental Analysis
FactSet's revenue trajectory shows steady but decelerating growth. In the most recent quarter (Q3 FY2026, ended May 31, 2026), revenue was $622.9 million, up 6.4% year-over-year, compared to 4.6% growth in the prior year's Q3. However, sequential growth from Q2 FY2026 ($611.0 million) was only 1.9%, indicating a slowdown. Revenue segments show the Americas contributed $407.2 million (65.4% of total), EMEA $151.9 million (24.4%), and Asia Pacific $63.7 million (10.2%), with the Americas being the primary growth driver. The multi-quarter trend shows revenue growth has been in the 4-7% range over the past year, suggesting a mature, subscription-based business with limited acceleration potential. For the investment case, this implies FactSet is a steady but low-growth compounder, relying on price increases and new product adoption rather than volume-driven expansion.
FactSet is highly profitable, with net income of $126.7 million in Q3 FY2026, representing a net margin of 20.3%. Gross margin was 49.9%, slightly down from 52.1% in the year-ago quarter, indicating some cost pressure. Operating margin was 26.7%, down from 33.2% in Q3 FY2025, reflecting higher operating expenses. Over the trailing twelve months, net income totaled $565.9 million, with a net margin of 25.7%. The company's profitability is strong compared to the broader market, but margins have compressed recently due to investments in technology and acquisitions. The trajectory toward margin expansion is uncertain; management's focus on cost efficiencies may help, but competitive pressures and the need for R&D spending could limit upside.
FactSet's balance sheet is healthy, with a debt-to-equity ratio of 0.71 and a current ratio of 1.40, indicating adequate liquidity. Free cash flow (FCF) for the trailing twelve months was $708.3 million, representing a FCF yield of 5.0% based on the current market cap of $14.2 billion. The company generated $284.5 million in operating cash flow in Q3 FY2026, easily covering capital expenditures of $30.5 million. Return on equity (ROE) is 27.3%, reflecting efficient capital use. The company has been actively repurchasing shares, with $203.1 million in buybacks in Q3 FY2026, and pays a dividend yield of 1.1%. Overall, FactSet's financial health is strong, with sufficient cash generation to fund growth internally and return capital to shareholders.
Quarterly Revenue
$622918000.0B
2026-05
Revenue YoY Growth
+6.4%
YoY Comparison
Gross Margin
49.9%
Latest Quarter
Free Cash Flow
$708307000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is FDS Overvalued?
Given that FactSet has positive net income ($126.7 million in Q3 FY2026), the primary valuation metric is the price-to-earnings (PE) ratio. The trailing PE is 23.7x, while the forward PE is 12.9x, implying the market expects significant earnings growth in the coming year. The gap between trailing and forward PE suggests that analysts anticipate a sharp increase in earnings, likely due to cost-cutting or margin recovery. However, the forward PE of 12.9x appears low relative to historical levels, which could indicate either undervaluation or skepticism about the sustainability of earnings estimates.
Compared to the industry (Financial - Data & Stock Exchanges), FactSet's trailing PE of 23.7x is above the industry average of 22.0x (based on available data), representing a 7.7% premium. The price-to-sales (PS) ratio of 6.1x is below the industry average of 8.0x, suggesting a discount on a sales basis. The EV/EBITDA multiple of 15.9x is in line with the industry average of 16.0x. The premium on PE may be justified by FactSet's superior profitability (net margin of 25.7% vs. industry average of 20%) and strong ROE of 27.3%. However, the discount on PS could reflect slower revenue growth compared to peers.
Historically, FactSet's trailing PE has ranged from 15.1x (in Q2 FY2026) to 63.8x (in Q4 FY2023), with the current 23.7x near the lower end of its five-year range. The current PE is below the five-year average of approximately 30x, suggesting the stock is trading at a discount to its own history. This could indicate a value opportunity if the company's growth and margins stabilize, but it may also reflect structural challenges such as competition from AI-driven alternatives or slower industry growth. The forward PE of 12.9x is near historical lows, implying that the market is pricing in pessimistic expectations, which could be an attractive entry point for contrarian investors.
PE
23.7x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 15x~48x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
15.9x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: FactSet's debt-to-equity ratio of 0.71 is manageable, but operating margin compression from 33.2% to 26.7% over the past year signals cost pressures. Revenue growth of 6.4% is modest and decelerating sequentially, with no clear catalyst for acceleration. The company's reliance on subscription renewals (80%+ buy-side) makes it sensitive to client budget cuts in a downturn. Free cash flow of $708M is strong, but any disruption to renewals could pressure cash generation.
Market & Competitive Risks: FactSet trades at a trailing PE of 23.7x, a 7.7% premium to the industry average of 22.0x, leaving it vulnerable to multiple compression if growth disappoints. Competition from Bloomberg and Refinitiv, as well as AI-driven alternatives, threatens market share. The stock's beta of 0.715 provides some downside protection, but the 39.6% one-year decline shows it is not immune to sector rotation. Recent news about AI disruption in financial data sectors (Benzinga, Feb 2026) highlights structural risks.
Worst-Case Scenario: If revenue growth slows below 4%, margins continue to compress, and the Fed keeps rates high (as warned by Powell in May 2026), the stock could fall to its 52-week low of $185.00, representing a 27.3% decline from the current price of $254.36. In a severe recession, the stock could test lower levels, with the historical max drawdown of -57.8% suggesting a potential drop to ~$107. However, the analyst low target of $210.00 implies a more moderate 17.4% downside.
FAQ
The key risks are: 1) Financial: Operating margin compression from 33.2% to 26.7% YoY could continue, pressuring earnings. 2) Competitive: AI-driven alternatives and competition from Bloomberg/Refinitiv could erode market share. 3) Macro: High interest rates (Fed warning in May 2026) could slow client spending on subscriptions. 4) Company-specific: Revenue growth of 6.4% is decelerating and may not support the current valuation. The most severe risk is a recession causing subscription cancellations, potentially driving the stock to the 52-week low of $185.00, a 27.3% decline.
The 12-month forecast is mixed. The bull case (25% probability) sees the stock reaching $280-$340 if margins recover and growth accelerates. The base case (50% probability) expects the stock to trade in a $240-$270 range, near the analyst average target of $255.06. The bear case (25% probability) projects a decline to $185-$220 if growth slows and margins compress further. The most likely scenario is the base case, with the stock remaining range-bound as the market awaits clearer signals on growth and margins.
FDS appears fairly valued to slightly undervalued based on forward metrics. The forward PE of 12.9x is well below the five-year average of ~30x, suggesting undervaluation if earnings estimates are achievable. However, the trailing PE of 23.7x is a 7.7% premium to the industry average of 22.0x, indicating a slight premium on historical earnings. The PS ratio of 6.1x is below the industry average of 8.0x, implying a discount on sales. The market is pricing in pessimistic expectations, which could be an opportunity if the company executes. The PEG ratio of 2.05x suggests the stock is not cheap on a growth-adjusted basis.
FDS is a hold rather than a buy at current levels. The stock offers a forward PE of 12.9x, which is historically cheap, and a FCF yield of 5.0%, providing a margin of safety. However, the analyst consensus is Hold with only 0.3% upside to the average target of $255.06, and the stock has declined 39.6% over the past year. For value investors with a long-term horizon, it could be a good buy if you believe margins will stabilize and growth will re-accelerate. For growth-oriented investors, the decelerating revenue and margin compression make it less attractive. The biggest downside risk is a further 17.4% decline to the analyst low target of $210.00.
FDS is more suitable for long-term investment due to its mature, subscription-based business model and low beta of 0.715, which provides stability. The dividend yield of 1.1% and consistent buybacks ($203.1M in Q3 FY2026) reward patient investors. Short-term trading is riskier given the stock's 39.6% one-year decline and high uncertainty. A minimum holding period of 3-5 years is recommended to allow the company to navigate competitive pressures and potentially benefit from multiple expansion. The stock's earnings visibility is high due to subscriptions, but growth is slow, making it a long-term compounder rather than a short-term momentum play.