Core Viewpoint - Wall Street analysts predict that FactSet Research (FDS) will report quarterly earnings of $4.39 per share, reflecting a year-over-year increase of 0.5%, with revenues expected to reach $599.48 million, a 5.4% increase compared to the previous year [1]. Earnings Estimates - The consensus EPS estimate has been revised 0.1% lower over the last 30 days, indicating a collective reevaluation by analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate revisions and short-term stock price performance [3]. Revenue Projections - Analysts estimate 'Revenues from clients- International' to be $207.74 million, representing a 3.1% increase from the year-ago quarter [5]. - The consensus estimate for 'Revenues from clients- US' is $390.23 million, indicating a year-over-year change of 6.3% [5]. - 'Total Annual Subscription Value' is expected to reach $2.41 billion, up from $2.27 billion reported in the same quarter last year [5]. Key Metrics - Analysts project 'ASV from buy-side clients' to remain at 82.1%, consistent with the previous year's figure [6]. - 'Total Users' are forecasted to reach 231,131, an increase from 218,267 reported in the same quarter last year [6]. Market Performance - Over the past month, shares of FactSet have returned +6.8%, contrasting with the Zacks S&P 500 composite's -0.2% change [6]. - FactSet currently holds a Zacks Rank 3 (Hold), suggesting its performance may align with the overall market in the near future [6].

Core Insights - FactSet Research Systems Inc. (FDS) is scheduled to report its first-quarter fiscal 2026 results on December 18, before market open [1] Revenue Expectations - The consensus estimate for FDS's first-quarter fiscal 2026 revenues is $599.5 million, reflecting a 5.4% growth compared to the same quarter last year [2] - Revenues from the Americas are projected to be $389.5 million, indicating a 6.1% year-over-year growth, driven by increased technology investments from asset managers [2] - EMEA revenues are expected to grow 2% year-over-year to $146.7 million, with recovery in the U.K. market contributing to this growth [3] - Revenues from the Asia Pacific are anticipated to reach $61.7 million, representing a 7% increase year-over-year, supported by new client acquisitions [3] Earnings Expectations - The consensus estimate for earnings is $4.39 per share, suggesting a slight increase compared to the previous year [3] - The model predicts an earnings beat for FDS, supported by a positive Earnings ESP of +1.77% and a Zacks Rank of 3 (Hold) [4]

Group 1 - The upcoming year 2026 is expected to be crucial for stock pickers, as previous successful strategies may not yield the same results due to changing market conditions [2][4] - The analysts at InvestorPlace achieved significant outperformance in 2025, with their recommendations surpassing the S&P 500 by nearly 1,000 basis points [2][3] - The new strategy for Power Portfolio 2026 will shift focus from AI stocks to 11 companies poised to benefit from a significant investment boom driven by U.S. government spending [5][6] Group 2 - The U.S. government is anticipated to initiate an $11.3 trillion investment bonanza aimed at revitalizing the economy, which will be discussed in the upcoming American Dream 2.0 Summit [6][8] - PayPal Holdings Inc. is highlighted as a top stock for 2026 due to its unique position as the first payments platform integrated with ChatGPT, despite not making it into the final Power Portfolio [10][15] - FactSet Research Systems Inc. is identified as an acquisition target with a potential 20% upside over the next three years, driven by increased M&A activity and its low valuation [16][18][20] - Tronox Holdings PLC is noted for its position in the titanium dioxide market, with potential for significant upside if business conditions normalize, although it is considered too risky for the Power Portfolio [26][29]

Core Insights - FactSet has launched its market intelligence services via Amazon Quick Research, enhancing accessibility for clients [1][2] - The integration aims to streamline research processes for enterprise-level AI strategies, reducing manual data uploads [2][3] - FactSet emphasizes its long-standing commitment to innovation in the AI space, supporting clients in deploying their own AI strategies [3] Company Overview - FactSet is a global financial digital platform with over 47 years of experience, serving approximately 9,000 clients and over 237,000 users [4] - The company provides integrated financial data and technology solutions across various sectors, including buy-side, sell-side, and private equity [4] - FactSet is a member of the S&P 500 and operates in 20 countries, focusing on innovation and long-term client success [4]

Core Insights - FactSet and Arcesium have formed a strategic partnership to create a unified investment management solution that integrates front, middle, and back office workflows across public, private, and alternative markets, addressing the industry's need for streamlined operations and data connectivity [1][2][5] Industry Challenges - Data fragmentation is identified as the primary operational challenge for asset managers, with regulatory compliance costs reportedly doubling over the past decade, prompting firms to innovate and adapt their operations [2] - The convergence of public and private markets is leading to significant shifts in capital allocation and competition, with mega-managers capturing 46% of capital raised while representing less than 3% of managers [4] Solution Features - The partnership offers an end-to-end solution that integrates analytics engines, data pipelines, and AI-powered workflows, enabling deeper due diligence and streamlined portfolio monitoring across various asset classes [2][6] - The platform combines FactSet's front and middle-office analytics with Arcesium's back-office technology, including Investment Book of Record (IBOR) and Accounting Book of Record (ABOR), providing a single source of truth for investment and compliance teams [8][9] Market Trends - Private credit fundraising has reached record levels, increasing from $198 billion in 2023 to $210 billion in 2024, with $124 billion raised in the first half of 2025, indicating a growing interest in private market investments [4] - As global private capital continues to expand, asset owners and managers face rising demands for data transparency and increasingly complex portfolios, which the FactSet-Arcesium partnership aims to address [5] Technological Integration - The collaboration leverages FactSet's global data infrastructure and Arcesium's cloud-native technology to enhance data consistency and analytics, facilitating the integration of middle and back-office functions that have historically been underserved [6][10] - The unified platform is designed to empower asset managers to streamline operations, automate processes, and adapt to evolving regulatory demands without vendor lock-in [6]

Core Points - FactSet will release its financial and operating results for Q1 fiscal 2026 on December 18, 2025 [1] - A conference call will be held at 9:00 a.m. Eastern Time on the same day to discuss the results [2] - The earnings presentation will be available on FactSet's Investor Relations website at 8:30 a.m. Eastern Time on December 18, 2025 [3] Company Overview - FactSet is a global financial digital platform and enterprise solutions provider, serving approximately 9,000 global clients and over 237,000 individual users [4] - The company integrates proprietary financial data, client datasets, and third-party sources to deliver tailored solutions across various sectors [4] - FactSet has over 47 years of expertise and operates in 20 countries, focusing on innovation and long-term client success [4]

Core Insights - Baron Durable Advantage Fund's performance in Q3 2025 showed a 5.6% appreciation for Institutional Shares, underperforming the S&P 500 Index which increased by 8.1% during the same period [1] - Year-to-date, the fund is up 13.6%, slightly below the S&P 500's 14.8% gain, indicating a strong rally in U.S. large-cap equity markets since the beginning of 2023 [1] Company Analysis: S&P Global Inc. (NYSE:SPGI) - S&P Global Inc. experienced a 7.5% decline in its stock price during Q3 2025, attributed to cautious commentary from a competitor regarding market demand and margins, which affected the broader information services sector [3] - Despite the decline, S&P Global's management clarified that the trends affecting the company remain stable, and the firm is expected to report positive results driven by increased debt issuance and a recovering capital market [3] - The company's revenue grew by 9% year-over-year in Q3 2025, with subscription revenue increasing by 6%, indicating solid operational performance [4] - S&P Global is not among the 30 most popular stocks among hedge funds, with 106 hedge fund portfolios holding its shares at the end of Q2 2025, a slight decrease from 108 in the previous quarter [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]

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].