FactSet

FactSet Stock Hits Record High After Analysts Boost Price Targets Post Solid Q1 Earnings

FactSet Research shares scaled to a new record high on Wednesday as several equity analysts raised their price targets after the financial data and software company beat earnings and revenue estimates for the fiscal first quarter.

The Norwalk, Connecticut-based company that provides financial analytics and services to the investment community worldwide reported quarterly adjusted earnings of $3.25​​ per share for the quarter ended in November, beating the market expectations of $3.00 per share.

The data company said its revenue jumped over 9% to $424.73 million from a year earlier, also topping the Wall Street consensus estimates of $419.13 million.

For the full year, the firm anticipates earnings between $12.30 to $12.50 per share range, with revenue in the range of $1.71 billion to $1.72 billion.

Following this, FactSet stock hit a record high of $478.89 on Wednesday. It soared over 43% so far this year.

FactSet Stock Price Forecast

Morgan Stanley raised the base target price of $352 from $323 with a high of $556 under a bull scenario and $196 under the worst-case scenario. The firm gave an “Underweight” rating on the financial analytics company’s stock.

“Strong organic growth led to a beat in the quarter, while new CFO, Linda Huber, provided insight into margin initiatives. We continue to prefer other names across the Info Services group with higher EPS growth that trade at lower multiples. We raise our price target to $352, but remain UW,” noted Toni Kaplan, equity analyst at Morgan Stanley.

“We believe FactSet’s (FDS) multiple is at risk given FDS trades at a significant premium to its history and peers. We prefer other stocks in our Analytics coverage that offer better value on a growth-adjusted basis. Market conditions continue to be challenging, pressuring growth. We assume a CAGR (’19-’25E) of 6.2% for revenues with adj. operating margins of ~34% in 2025.”

Several other analysts have also updated their stock outlook. CFRA raised the target price to $470. Jefferies lifted the target price to $482 from $388. Stifel upped the target price to $468 from $400. Credit Suisse increased the target price to $475 from $395.

Technical analysis also suggests it is good to buy now as 100-day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

However, ten analysts who offered stock ratings for FactSet in the last three months forecast the average price in 12 months of $439.67 with a high forecast of $550.00 and a low forecast of $351.00.

The average price target represents a -7.91% change from the last price of $477.43. Of those ten analysts, two rated “Buy”, five rated “Hold” while three rated “Sell”, according to Tipranks.

Analyst Comments

“What to do with FactSet (FDS) shares: Buy more if you think FY2022 organic ASV can trend above the high end of guidance range and that longer-term there could be balance sheet and portfolio-driven catalysts that are underappreciated (further M&A etc.). We prefer the sidelines for now and wait for a better entry point,” noted Hamzah Mazari, equity analyst at Jefferies.

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