RBC Capital maintains FactSet stock rating with $503 target

Published 03/06/2025, 15:28
RBC Capital maintains FactSet stock rating with $503 target

On Tuesday, RBC Capital reiterated its Sector Perform rating for FactSet Research Systems stock, maintaining a price target of $503, representing potential upside from the current price of $434.49. The decision reflects the firm’s analysis of FactSet’s financial outlook and market conditions. According to InvestingPro data, the company maintains strong financial health with an overall score of "GOOD" and has consistently raised its dividend for 26 consecutive years.

RBC Capital analysts estimate approximately $17 million in quarter-over-quarter ASV growth for FactSet in the third quarter of 2025. This growth is attributed to low-to-mid teens international pricing increases, a slight improvement over the $16 million growth seen in the third quarter of 2024. With the next earnings report due on June 23, investors following InvestingPro analysis can access detailed insights and 8+ additional ProTips about FactSet’s valuation and growth prospects.

Despite investor concerns regarding potentially weaker-than-expected hiring in the banking sector and reduced IT spending by banks and asset managers, the firm expects FactSet to reaffirm its fiscal year 2025 guidance. This confidence is partly based on the strong performance anticipated in the fourth quarter of 2025.

Furthermore, FactSet has already contracted 15% of its second-half 2025 pipeline, demonstrating strong momentum in data solutions and improved performance on the buy-side. These factors contribute to RBC Capital’s continued support of the company’s stock rating.

In other recent news, FactSet Research Systems reported second-quarter earnings for fiscal year 2025, surpassing analysts’ expectations with an adjusted diluted earnings per share (EPS) of $4.28, compared to the forecasted $4.21. The company also reported revenues of $571 million, slightly above the anticipated $570.13 million, marking a 4.5% year-over-year growth. FactSet’s organic Annual Subscription Value (ASV) increased by 4.1% year-over-year, reflecting steady demand for its financial data services. Despite these positive results, BMO Capital Markets reduced FactSet’s stock price target from $498 to $466, maintaining a Market Perform rating. This adjustment follows FactSet’s recent earnings report and a slowdown in ASV growth, which prompted BMO to adopt a more cautious stance due to broader economic conditions.

Raymond (NSE:RYMD) James reiterated its Underperform rating on FactSet shares, expressing concerns over the company’s transition from consistent growth to a more cyclically affected business facing strong competition. The firm highlighted FactSet’s recent acquisitions of Irwin and LiquidityBook, suggesting that the company might have overpaid in its strategy to stimulate growth. Despite these challenges, FactSet’s management remains optimistic, supported by a robust sales pipeline and successful renewal cycles, particularly within the banking sector. The company’s reaffirmed guidance for fiscal year 2025 incorporates the impact of recent smaller-scale acquisitions, known as tuck-in acquisitions, which are expected to enhance its product offerings without significant disruption to operations.

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