Core Insights - October was a challenging month for stock selection, with the 15 selected stocks experiencing an average decline of 0.41% in value [1]. Group 1 - The SPDR S&P 500 Trust ETF was referenced, indicating a broader market context for the stock performance [1]. - The analyst has over 10 years of experience in the investment field, starting as an analyst and advancing to a management role [1]. - Dividend investing is highlighted as a personal interest of the analyst, suggesting a focus on income-generating investments [1].

Core Insights - FactSet Research Systems Inc. is a financial data provider with a market cap of $10.9 billion, operating globally across various regions [1] - The company is expected to announce its Q1 results by mid-December, with analysts predicting an adjusted profit of $4.39 per share, a slight increase from $4.37 in the same quarter last year [2] - For the full fiscal year 2026, adjusted EPS is projected to be $17.30, reflecting a 1.9% increase from $16.98 in 2025, with a further expected surge of 11.3% to $19.25 in fiscal 2027 [3] Stock Performance - FactSet's stock has declined by 37.2% over the past 52 weeks, significantly underperforming the Financial Select Sector SPDR Fund's 12.2% gains and the S&P 500 Index's 18.3% returns [4] - Following the release of Q4 results on September 18, the stock price dropped by 10.4% in a single trading session [5] Financial Metrics - As of the end of August, FactSet's annual subscription value (ASV) was $2.4 billion, marking a 6.7% year-over-year increase [5] - The company's revenues for the quarter rose by 6.2% year-over-year to $596.9 million, surpassing consensus estimates by 72 basis points [5] - Operating margins contracted by 200 basis points year-over-year to 33.8%, while adjusted EPS grew by 8.3% year-over-year to $4.05, falling 2.4% short of Street expectations [6] Analyst Sentiment - Analysts maintain a cautious outlook on FactSet, with a consensus "Hold" rating; among 19 analysts, there are two "Strong Buys," 10 "Holds," and seven "Strong Sells" [7] - The mean price target for the stock is $335.07, indicating a potential upside of 16.2% from current price levels [7]

Core Insights - FactSet Research Systems Inc. (NYSE:FDS) is recognized as one of the 10 Best Rising Dividend Stocks to Buy Now [1] Group 1: Financial Performance - FactSet offers a subscription-based model for financial data and analytics, with an annual subscription value (ASV) retention rate exceeding 95%, providing a stable revenue base [2] - The company has increased dividends for 26 consecutive years, currently paying a quarterly dividend of $1.10 per share, which results in a yield of 1.52% as of October 28 [3] Group 2: Technological Innovation - FactSet is focusing on technological advancements, including the launch of its Intelligent Platform and AI-driven solutions such as IRN 2.0 and DaaS, aimed at enhancing client operations and service delivery [4]

Core Insights - The financial industry is undergoing significant changes due to the digital revolution, necessitating companies to adapt and scale up to remain competitive [1] Company Insights - FactSet Research has been identified as an interesting stock within the evolving financial landscape [1] - The analyst has been involved in stock investing and macroeconomic analysis for nearly a decade, focusing on various sectors including banks, telecommunications, logistics, and hotels [1] Market Insights - The analyst has diversified investments across different industries and market capitalizations, including holdings in US banks, hotels, shipping, and logistics companies [1] - The analyst's experience includes trading in both the ASEAN and US markets, with a particular emphasis on the financial sector [1]

Core Viewpoint - The recommendation for FactSet Research Systems (NYSE: FDS) is a buy rating, emphasizing that the market is overly focused on short-term margin pressure while underappreciating the strength of its AI strategy and core business [1] Investment Approach - The investment strategy focuses on long-term investments while incorporating short-term shorts to uncover alpha opportunities [1] - The approach revolves around bottom-up analysis, examining the fundamental strengths and weaknesses of individual companies [1] - The investment duration is medium to long-term, aiming to identify companies with solid fundamentals, sustainable competitive advantages, and growth potential [1]

Core Insights - Conestoga Capital Advisors reported that equity markets reached new all-time highs in Q3 2025, but their Mid Cap Composite underperformed with a return of -3.2% net-of-fees compared to a 2.8% gain for the Russell Midcap Growth Index [1] - The focus on high-quality, profitable companies faced challenges in a risk-on environment, impacting performance [1] Company Analysis: FactSet Research Systems Inc. (NYSE:FDS) - FactSet Research Systems Inc. provides integrated financial information and analytical applications for the investment community, with a one-month return of 1.98% and a 52-week loss of 36.76% [2] - As of October 21, 2025, FactSet's stock closed at $294.11 per share, with a market capitalization of $11.119 billion [2] - The company is experiencing slowed organic growth due to budget constraints at asset managers and increased competition from firms like Bloomberg and S&P, alongside rising technology and content costs affecting margins [3] - Despite being a high-quality franchise, FactSet's premium valuation presents execution risks [3] Market Position and Hedge Fund Interest - FactSet is not among the 30 most popular stocks among hedge funds, with 36 hedge fund portfolios holding the stock at the end of Q2 2025, an increase from 29 in the previous quarter [4] - In Q4 of fiscal 2025, FactSet's revenues grew by 6.2% year-over-year, reaching $597 million [4] - While FactSet shows potential as an investment, certain AI stocks are considered to offer greater upside potential with less downside risk [4]

Client and Revenue Metrics - As of August 31, 2025, FactSet had approximately 9,000 clients and over 237,000 investment professionals using its platform[16]. - Revenues from the Americas segment represented 65% of total revenues during fiscal 2025, while EMEA and Asia Pacific accounted for 25% and 10%, respectively[20]. - Annual Subscription Value (ASV) retention was greater than 95%, with annual retention expressed as a percentage of clients at 91% for the year ended August 31, 2025[30]. - Buy-side clients accounted for approximately 82% of FactSet's Organic ASV as of August 31, 2025[31]. - Organic Annual Subscription Value (Organic ASV) totaled $2,370.9 million, reflecting a 5.7% increase over the prior year, with significant growth in the Americas[157]. - ASV from the Americas represented 65% of total ASV at $1,570.1 million, a 7.9% increase from the previous year[167]. - ASV from EMEA accounted for 25% of total ASV at $591.6 million, marking a 3.5% increase from the prior year[168]. - As of August 31, 2025, Asia Pacific ASV was $243.9 million, a 5.7% increase from $230.3 million in 2024, with organic ASV growing 7.2% to $242.7 million[169]. - The company added 779 clients, bringing the total to 8,996, a 9.5% increase year-over-year[172]. - User count increased by 20,943 to 237,324, representing a 9.7% growth, primarily from wealth management users[173]. Financial Performance - Revenues for fiscal 2025 were $2,321.7 million, an increase of 5.4% from the prior year, driven by a 4.4% increase in organic revenues[156]. - Operating margin improved to 32.2% for fiscal 2025, up from 31.8% in fiscal 2024, primarily due to revenue growth[158]. - Net income for fiscal 2025 was $597.0 million, an increase of 11.2% from the prior year, with diluted earnings per share rising to $15.55, an increase of 11.8%[159]. - The company returned $460.4 million to stockholders through share repurchases and dividends during fiscal 2025[159]. - Operating income rose 6.7% to $748.3 million, with an operating margin of 32.2%, up from 31.8% in the prior year[191]. - Cost of services increased by 8.5% to $1,097.8 million, primarily due to higher employee compensation and amortization of intangible assets[187]. - SG&A expenses decreased by 2.9% to $475.7 million, with a margin of 20.5% of revenues, down 170 basis points from the previous year[190]. - Adjusted net income for fiscal 2025 was $651,617,000, a 2.6% increase from $635,073,000 in fiscal 2024[205]. - Cash and cash equivalents as of August 31, 2025, were $337.7 million, down from $423.0 million as of August 31, 2024[207]. - The company had $486.9 million of undistributed foreign earnings as of August 31, 2025, with $69.1 million permanently reinvested[208]. Employee and Organizational Insights - As of August 31, 2025, FactSet had 12,800 employees, representing a 3.2% increase compared to the previous year[41]. - In fiscal 2025, 94% of employees participated in learning programs, completing 339,000 hours globally[43]. - The employee engagement survey in fiscal 2025 achieved an 88% response rate, indicating strong employee alignment with the company's purpose[43]. - FactSet employees contributed 17,200 volunteer hours across 391 events in fiscal 2025, with over 85% participating in philanthropic initiatives[43]. - In fiscal 2025, FactSet expanded mental health resources through a global platform providing access to on-demand clinical experts and personalized wellness content[47]. - The company has donated over 9 million meals since 2019 through its Hunger Awareness initiative[47]. - As of August 31, 2025, 47% of employees were in Content Operations, 28% in Technology and Product Development, 21% in Sales and Client Solutions, and 4% in Corporate Support[42]. Leadership and Governance - The Chief Executive Officer, Sanoke Viswanathan, was appointed effective September 8, 2025[49]. - Helen L. Shan serves as Chief Financial Officer, overseeing all financial functions since her appointment on July 23, 2024[50]. - Christopher R. Ellis was appointed as Executive Vice President, Head of Strategic Initiatives and Partnerships effective November 1, 2023[58]. Technology and Cybersecurity - FactSet's AI solutions are generating increased usage and demand, with a focus on integrating AI into client workflows to enhance productivity[33]. - The company operates two fully redundant data centers in the U.S. and utilizes multiple cloud providers to support its operations[35]. - The company continues to invest in AI solutions to improve product discoverability and usability, adapting to clients' evolving workflows[37]. - The company maintains a dedicated information security program with approximately 60 employees focused on managing cybersecurity risks[119]. - The company’s cybersecurity risk management is integrated into its broader Enterprise Risk Management framework, reviewed quarterly[121]. - The company faces significant cybersecurity risks, including unauthorized access to confidential data and potential cyber-attacks, which could adversely affect its operations and financial condition[64]. Market and Competitive Landscape - FactSet's competitive landscape includes major players like Bloomberg L.P. and S&P's Market Intelligence division, highlighting the competitive nature of the financial information services industry[39]. - The company is experiencing intense competition across its products and services, with competitors leveraging advanced technologies, including AI, which may impact market share and profitability[81]. - A continued shift from active to passive investing could negatively affect user growth and demand for the company's services, as passive investing requires lower fees and less decision-making[82]. - Economic downturns and uncertainty in the global economy may lead to client consolidation and reduced demand for the company's products and services, impacting overall business results[84]. - The increasing availability of free or inexpensive information sources may reduce demand for the company's products and services[95]. Regulatory and Compliance Risks - The company is subject to SEC reporting requirements and maintains minimum net capital requirements as a registered broker-dealer[44]. - The company is exposed to fluctuations in foreign currency exchange rates, particularly with the British Pound Sterling, Euro, Indian Rupee, and Philippine Peso, which may adversely affect financial results[109]. - The company is subject to numerous global data privacy laws, which could impact its operations and expose it to claims of violations[105]. - Legislative and regulatory changes, such as the EU's DORA and the U.S. Financial Data Transparency Act, may increase compliance costs and impact client relationships[101]. - The company identified a material weakness in internal controls related to financial reporting, with remediation efforts expected to continue into fiscal 2026[99]. Strategic Initiatives and Challenges - The company is investing in enhancing its information technology disaster recovery processes to minimize service disruption risks, although challenges remain in maintaining operational resilience[74]. - The company is implementing a multi-year project to modernize its IT infrastructure, which involves substantial expenditures and risks associated with transitioning to new technologies[75]. - The use of open source software in the company's products may introduce security vulnerabilities and unexpected restrictions, potentially impacting commercialization efforts[76]. - The company faces challenges in developing and marketing new products to maintain technological competitiveness amid rapid market changes, including AI advancements[86]. - Errors or defects in new products can lead to market rejection, reputational damage, and loss of revenues, particularly after product introductions[87]. - Clients are increasingly seeking additional contractual protections, which may create liabilities and compliance challenges for the company[88]. - In fiscal 2025, the company completed several acquisitions, including Irwin, LiquidityBook, and LogoIntern, but faces integration risks and the challenge of realizing anticipated benefits[89]. - The company relies on third-party service providers for critical functions, which exposes it to risks of system failures and security breaches that could impact operations[65]. - The company relies on third-party content agreements, which may be subject to termination or increased costs, impacting the availability of key information for clients[94].

Core Insights - FactSet Research Systems Inc. (NYSE:FDS) is considered undervalued with a price-to-earnings multiple of 15, indicating potential for growth [1] - The company provides financial data, analytics, and digital solutions that support investment research, portfolio management, and risk analysis [1] - Despite strong fiscal Q3 earnings and positive management commentary, FactSet's stock performance was negatively impacted by the announcement of CEO Phil Snow's retirement [1] Financial Performance - FactSet's shares detracted from performance in the second quarter of 2025, overshadowed by strong results from competitors like Interactive Brokers Group, Inc. [1] - The company has a large addressable market and demonstrates strong execution in new product development and financial results [1] - FactSet generates robust free cash flow, which supports its long-term investment potential [1] Market Position - The company is viewed favorably for its long-term prospects, despite some volatility due to leadership changes [1] - There is a belief that certain AI stocks may offer greater upside potential compared to FactSet, indicating a competitive landscape in the financial analytics sector [1]

Core Insights - FactSet is launching its 2025 Buy-Side Forum series across four cities in the Asia-Pacific region to address the impact of AI-driven strategies and advanced data solutions on financial professionals amid market volatility and regulatory changes [1][2] Group 1: Event Details - The Buy-Side Forum will take place in Hong Kong on Nov. 4, followed by events in Tokyo (Nov. 6), Sydney (Nov. 11), and Singapore (Nov. 13) [1] - The forum aims to showcase how FactSet is driving innovation and helping clients succeed in the dynamic APAC financial markets [2] Group 2: Industry Challenges and Solutions - The forum will feature sessions on how front and middle office clients are utilizing FactSet's solutions to tackle pressing challenges in the financial sector [2][3] - Key topics include the use of predictive analytics for risk management, AI-driven reporting for compliance, and advancements in algorithmic trading and execution [5] Group 3: Technological Innovations - Asset managers are leveraging AI for real-time credit risk tracking and compliance as regulations tighten in markets like Singapore [5] - The transformation of market data infrastructure through cloud adoption and integration of alternative data is crucial for capturing opportunities in rapidly changing APAC markets [5] Group 4: Company Overview - FactSet provides enterprise data and information solutions, integrating proprietary financial data and advanced technology to enhance decision-making across various sectors [4][6] - The company serves approximately 9,000 global clients and has a presence in 20 countries, emphasizing innovation and long-term client success [4][6]

Group 1 - The article discusses the worst-performing stocks in the S&P 500 index for September, highlighting significant declines in share prices [1][8]. - CarMax experienced a 24.8% drop in stock value due to disappointing second-quarter results, with revenue and profits down by 25% year over year, reflecting decreased consumer enthusiasm for car purchases [3]. - FactSet Research Systems saw a 22.3% decline, attributed to results that fell below analyst expectations [4]. - Kenvue's stock fell by 21.9%, influenced by negative public perception regarding Tylenol's alleged link to autism following statements from public figures [5]. - Deckers Outdoor's shares decreased by 17.5%, impacted by concerns over tariffs and economic uncertainty, along with disappointing earnings reports [6]. - Synopsys experienced a 16.7% decline due to weakened demand from a major customer and previous export restrictions, which have since been lifted [7]. Group 2 - Despite the declines in these stocks, the S&P 500 index gained 3.5% in September, indicating a broader market resilience [8]. - The article suggests that while some stocks may have fallen due to temporary issues, they could present buying opportunities if the market has overreacted and the company's future remains promising [8][9]. - The Motley Fool Stock Advisor analyst team has identified ten stocks they believe are better investment options than CarMax, indicating a shift in investor focus [10].