Factset Research (FDS) AI Stock Analysis

• Market Cap: $7.63B
• Dividend Yield: 1.49%
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 17.0
• Beta (1Y): 0.42
• Revenue Growth: 5.88%
• EPS Growth: 12.18%
• Country: US
• Employees: 12,598
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 4.51
• Shares Outstanding: 37,099,260
• 10 Day Avg. Volume: 881,751
• 30 Day Avg. Volume: 1,179,461
• PEG Ratio: 2.05
• Price to Book (P/B): 6.48
• Price to Sales (P/S): 6.10
• P/FCF Ratio: 22.93
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 3.83
• Enterprise Value/Gross Profit: 7.33
• Enterprise Value/Ebitda: 9.19
• 1Y Price Target: $271.25
• Price Target Upside: 31.90% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 13
• EPS Forecast (FY): 17.51
• Revenue Forecast (FY): $2.45B

• Rating: 75 Outperform
• Price Target: $251.00 ▲(22.05% Upside)
• Action: Reiterated Date: 03/05/26
• Date: Action: Reiterated 03/05/26

The score is driven primarily by strong financial performance (high margins, solid cash conversion, and manageable leverage) and a positive earnings outlook with reaffirmed guidance and strong subscription-value growth. These strengths are tempered by weaker technical trend signals (below key longer-term moving averages and negative MACD), while valuation and dividend yield provide additional support.

Positive Factors

Recurring subscription revenue & high client retention

FactSet’s revenue mix is dominated by subscription-based ASV and ASP increased 5.9% to $2.4B while client retention remains ~91% and users near 240k. This creates durable, predictable revenue and upsell capacity, supporting steady cash flow and lower churn-driven volatility over months.

High margins and strong cash generation

FactSet reports robust profitability (high net and EBITDA margins) and growing free cash flow with operating cash conversion above parity. Sustained margins and efficient cash generation underpin internal investment, share repurchases and resilience to cyclical revenue swings over the medium term.

Elevated AI leadership and strategic partnerships

Promoting a Chief AI Officer and new CTO, plus AI product launches and partnerships (Anthropic, Kepler Cheuvreux), signals a structural shift to AI-enabled differentiation and platform modernization. This deepens product moat and supports longer-term client stickiness and new revenue streams.

Negative Factors

Rising operating expenses

Operating costs rose ~9% year-over-year largely from headcount and technology investments. While investments aim to drive future growth, sustained elevated SG&A and tech spend can erode margins and free cash flow if revenue acceleration or productivity gains lag, pressuring medium-term profitability.

Limited net new client additions

Net new client adds were just seven in the quarter, suggesting customer acquisition softness. Over months, constrained new-client growth limits addressable market expansion and forces heavier reliance on ASP upsells and renewals to sustain revenue growth, increasing execution risk.

Slight margin compression

Adjusted operating margin slipped as the company invests in technology and people. Even modest margin compression reduces cash available for buybacks and R&D; if cost inflation persists or pricing power weakens, margins could further contract, limiting long-term free cash flow growth.

Factset Research Business Overview & Revenue Model

Company Description

FactSet Research Systems Inc., a financial data and analytics company, provides integrated financial information and analytical applications to the investment community in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company delivers insight and information through the workflow solutions of research, analytics and trading, content and technology solutions, and wealth. It serves portfolio managers, investment banks, asset managers, wealth advisors, corporate clients, and other financial services entities. FactSet Research Systems Inc. was founded in 1978 and is headquartered in Norwalk, Connecticut.

How the Company Makes Money

FactSet generates revenue primarily through subscription fees for its software and data services. The company offers various pricing models based on the level of access and the specific products utilized by clients, which include asset managers, hedge funds, private equity firms, and financial institutions. Key revenue streams include data feeds, analytics software, and customized solutions tailored to client needs. Additionally, FactSet benefits from long-term contracts with its customers, leading to predictable recurring revenues. Significant partnerships with financial data providers and integration with third-party platforms further enhance its offerings and contribute to its earnings.

Factset Research Financial Statement Overview

Summary

Strong overall fundamentals supported by healthy profitability (TTM net margin 25.40%; EBITDA margin 38.99%) and solid cash generation (free cash flow up 4.85% TTM; operating cash flow to net income 1.66). Balance sheet leverage appears manageable (debt-to-equity 0.72) with strong ROE (27.99%), though slight margin compression suggests some cost pressure.

Income Statement

Factset Research demonstrates strong financial performance with consistent revenue growth, evidenced by a 1.68% increase in TTM revenue. The company maintains healthy profitability with a gross profit margin of 52.26% and a net profit margin of 25.40% in TTM. EBIT and EBITDA margins are robust at 24.70% and 38.99%, respectively, indicating efficient operations. However, slight declines in gross and net profit margins compared to previous periods suggest potential cost pressures.

Balance Sheet

The balance sheet reflects a stable financial position with a manageable debt-to-equity ratio of 0.72 in TTM, indicating prudent leverage. Return on equity remains strong at 27.99%, showcasing effective use of shareholder funds. The equity ratio stands at 51.37%, highlighting a solid capital structure. Despite improvements, the company should monitor its debt levels to maintain financial flexibility.

Cash Flow

Factset Research exhibits strong cash flow generation with a 4.85% growth in free cash flow in TTM. The operating cash flow to net income ratio is 1.66, indicating efficient cash conversion. The free cash flow to net income ratio of 0.85 suggests a healthy cash flow relative to earnings. Continued focus on cash flow management will support future growth initiatives.

Breakdown	TTM	Aug 2025	Aug 2024	Aug 2023	Aug 2022	Aug 2021
Income Statement
Total Revenue	2.36B	2.32B	2.20B	2.09B	1.84B	1.59B
Gross Profit	1.23B	1.22B	1.19B	1.11B	972.79M	805.04M
EBITDA	984.08M	965.96M	872.88M	788.00M	610.36M	581.08M
Net Income	599.60M	597.04M	537.13M	468.17M	396.92M	399.59M
Balance Sheet
Total Assets	4.22B	4.30B	4.06B	3.96B	4.01B	2.22B
Cash, Cash Equivalents and Short-Term Investments	292.68M	355.10M	492.60M	457.65M	536.49M	717.85M
Total Debt	1.56B	1.56B	1.57B	1.84B	2.22B	866.25M
Total Liabilities	2.05B	2.12B	2.14B	2.34B	2.68B	1.21B
Stockholders Equity	2.17B	2.19B	1.91B	1.62B	1.33B	1.02B
Cash Flow
Free Cash Flow	647.39M	617.45M	614.66M	584.79M	487.12M	493.90M
Operating Cash Flow	761.17M	726.26M	700.34M	645.57M	538.28M	555.23M
Investing Cash Flow	-243.38M	-392.77M	-144.32M	-95.39M	-2.03B	-135.99M
Financing Cash Flow	-528.26M	-407.82M	-560.85M	-632.02M	1.34B	-322.71M

Factset Research Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 205.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FDS, the sentiment is Negative. The current price of 205.65 is below the 20-day moving average (MA) of 208.74, below the 50-day MA of 240.36, and below the 200-day MA of 318.20, indicating a bearish trend. The MACD of -6.11 indicates Negative momentum. The RSI at 39.75 is Neutral, neither overbought nor oversold. The STOCH value of 10.90 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FDS.

Factset Research Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MSCI	76 Outperform	$40.26B	36.82	-74.96%	1.24%	9.02%	3.45%
FDS	75 Outperform	$7.63B	16.99	28.00%	1.49%	5.88%	12.18%
VALU	73 Outperform	$350.99M	15.17	20.88%	3.31%	-3.75%	-4.34%
MCO	71 Outperform	$76.24B	37.25	62.81%	0.73%	8.77%	13.62%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SPGI	67 Neutral	$126.24B	35.63	13.62%	0.73%	9.04%	21.35%
MORN	64 Neutral	$7.25B	24.33	25.12%	0.84%	7.76%	15.92%

Factset Research Corporate Events

FactSet Elevates AI Leadership with New C-Suite Roles

On March 4, 2026, FactSet Research Systems Inc. announced leadership changes effective March 2, 2026, with former Chief Technology Officer Kate Stepp appointed as Chief AI Officer and technology veteran Bob Stolte named Chief Technology Officer. Stepp will lead AI services and deployment across products and client solutions, while Stolte will oversee global technology, including platform modernization, engineering execution, cybersecurity, and operational resilience.

The appointments underscore FactSet’s strategy to accelerate enterprise AI adoption and strengthen its core technology platform in support of long-term growth. By elevating AI to a dedicated C-suite role and reinforcing technology leadership, the company is signaling a deeper commitment to AI-driven innovation, platform reliability, and differentiated capabilities for clients across the global financial ecosystem.

The most recent analyst rating on (FDS) stock is a Sell with a $210.00 price target. To see the full list of analyst forecasts on Factset Research stock, see the FDS Stock Forecast page.

FactSet shareholders approve new plans and governance changes

At its 2025 Annual Meeting of Stockholders held on December 18, 2025, FactSet Research Systems received stockholder approval for a series of governance and compensation measures, including the 2025 Omnibus Incentive Plan and a new Employee Stock Purchase Plan, alongside advisory approval of fiscal 2025 executive pay and the re‑election of all ten director nominees for one‑year terms. Stockholders also ratified Ernst & Young LLP as the independent auditor for the fiscal year ending August 31, 2026, and approved amendments to the company’s certificate of incorporation that reduce the voting threshold for stockholder action by written consent from a supermajority to a simple majority and remove obsolete language on board declassification, with the Third Amended and Restated Certificate of Incorporation becoming effective upon filing in Delaware on December 22, 2025, collectively reinforcing FactSet’s equity‑based compensation framework and signaling a shift toward more shareholder‑friendly governance.

The most recent analyst rating on (FDS) stock is a Hold with a $305.00 price target. To see the full list of analyst forecasts on Factset Research stock, see the FDS Stock Forecast page.