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FactSet Research Systems Inc FDS

Rating as of

Morningstar’s Analysis

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Economic Moat


Capital Allocation


Good Execution and Favorable Selling Environment Lead to Solid Results for FactSet

Rajiv Bhatia, CFA Equity Analyst

Analyst Note

| Rajiv Bhatia, CFA |

Narrow-moat rated FactSet finished its fiscal year on a high note with results topping consensus expectations. Adjusted revenue of $412 million and adjusted earnings per share of $2.88 topped the FactSet consensus of $405 million and $2.73, respectively. More importantly, the firm’s annual subscription growth accelerated to 7.2% and its initial fiscal 2022 outlook beat expectations. We attribute the firm’s growth to a favorable selling environment, as the equity bull market is helping asset managers, and strong merger and acquisition volumes at investment banks are leading to higher head count in that channel. In addition, we believe the firm’s offerings are resonating and thus FactSet is growing from the addition of new logos. We expect to raise our fair value estimate within a 5%-15% range; while this was a great quarter with sales momentum, we still view the firm’s shares as pricey.

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Company Profile

Business Description

FactSet provides financial data and portfolio analytics to the global investment community. The company aggregates data from third-party data suppliers, news sources, exchanges, brokerages, and contributors into its workstations. In addition, it provides essential portfolio analytics that companies use to monitor portfolios and address reporting requirements. Buy-side clients account for 84% of FactSet's annual subscription value. In 2015, the company acquired Portware, a provider of trade execution software and in 2017 the company acquired BISAM, a risk management and performance measurement provider.

45 Glover Avenue, 7th Floor
Norwalk, CT, 06850
T +1 203 810-1000
Sector Financial Services
Industry Financial Data & Stock Exchanges
Most Recent Earnings May 31, 2021
Fiscal Year End Aug 31, 2021
Stock Type Cyclical
Employees 10,892