The first-quarter results for FactSet Research Systems Inc. (NYSE:FDS) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of US$569m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.1% to hit US$3.89 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, FactSet Research Systems' 19 analysts are now forecasting revenues of US$2.30b in 2025. This would be a satisfactory 3.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 9.8% to US$15.57. In the lead-up to this report, the analysts had been modelling revenues of US$2.30b and earnings per share (EPS) of US$15.69 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of US$473, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on FactSet Research Systems, with the most bullish analyst valuing it at US$536 and the most bearish at US$390 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that FactSet Research Systems' revenue growth is expected to slow, with the forecast 4.5% annualised growth rate until the end of 2025 being well below the historical 10% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.5% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than FactSet Research Systems.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that FactSet Research Systems' revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple FactSet Research Systems analysts - going out to 2027, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for FactSet Research Systems you should know about.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.