FactSet Research stock price target lowered to $324 by BMO Capital

Investing.com - BMO Capital has lowered its price target on FactSet Research Systems (NYSE:FDS) to $324.00 from $452.00 while maintaining a Market Perform rating. The stock currently trades at $301.23, near its 52-week low of $297.86, with InvestingPro data showing the stock is trading in oversold territory.

The firm cited a margin-driven miss in FactSet’s recent earnings report, attributing the shortfall to higher technology expenses and increased bonus payments. The company maintains healthy financials with a 52.7% gross profit margin and $906M in EBITDA. Despite these challenges, BMO noted that Buy-Side drove sequential Annual Subscription Value (ASV) growth improvement.

FactSet’s fiscal year 2026 guidance aligned with consensus expectations, though margin performance will be affected by ongoing investments. The ASV growth forecast suggests a slight easing from the fourth quarter 2025 rate.

BMO Capital indicated that FactSet management is prioritizing significant artificial intelligence investments aimed at reaccelerating growth. The analyst noted that recent share weakness likely stems from investor concerns about long sales cycles and rigorous deal scrutiny, issues management had previously acknowledged.

The firm also pointed out that management did not reiterate long-term margin targets, though BMO does not believe these targets have changed. Based on these factors, BMO reduced both its estimates and price target for FactSet. For deeper insights into FactSet’s valuation and financial health metrics, access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with expert analysis and actionable intelligence.

In other recent news, FactSet Research Systems reported its fiscal fourth-quarter earnings for 2025, with revenue surpassing expectations at $597 million, compared to the projected $592.79 million. However, the company’s adjusted earnings per share (EPS) fell short of analysts’ forecasts, coming in at $4.05 against the expected $4.13. Analysts at Wells Fargo, Jefferies, and Evercore ISI have all lowered their price targets for FactSet, citing various concerns. Wells Fargo reduced its target to $296, maintaining an Underweight rating, following FactSet’s forward guidance which fell below market estimates. Jefferies adjusted its target to $315, holding a Hold rating, due to margin outlook concerns. Evercore ISI set its new target at $328, mentioning a 250 basis point margin headwind from platform investments as a reason. These developments reflect ongoing challenges and market reactions to FactSet’s recent performance and future projections.

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