A Look at FactSet Research Systems’s (FDS) Valuation After Quarterly Earnings Miss Disappoints Investors

FactSet Research Systems (FDS) shares recently dropped after the company reported quarterly earnings that fell short of expectations. This earnings miss has sparked disappointment among investors and has drawn renewed attention to the stock’s trajectory.

See our latest analysis for FactSet Research Systems.

FactSet Research Systems’ share price has taken a sharp turn lower in recent months, down 21.8% over the past month and now sitting at $283.13. The drop followed an earnings miss that rattled investor confidence despite FactSet’s efforts to expand with new acquisitions like Irwin and LiquidityBook. Even with top-line growth potential, sentiment has faded. FactSet’s total shareholder return is down 37.4% over the past year, reflecting both immediate disappointment and a shift in the company’s long-term momentum.

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So with FactSet shares trading well below their recent highs and analyst targets, does this pullback represent an attractive entry point for long-term investors? Or is the market already accounting for all future growth?

Most Popular Narrative: 16.5% Undervalued

FactSet’s most widely tracked narrative estimates fair value at $339.25, substantially above the last close price of $283.13. This narrative shapes market sentiment and highlights what could drive the next move for the stock.

FactSet is integrating new acquisitions like Irwin and LiquidityBook, adding immediate cross-sell opportunities and expanding services across buy-side and banking workflows, which will support revenue growth. The launch of new GenAI products, including Pitch Creator and conversational API, is expected to provide additional services that drive adoption and increase ASV growth, positively impacting future revenue.

Read the complete narrative.

Want to know which growth levers have bulls this excited? This narrative is fueled by aggressive expansion bets and monetizing next-gen AI tools. Can FactSet really hit the ambitious future earnings that justify this lofty price? Dig into the fine print and see what analysts are banking on.

Result: Fair Value of $339.25 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, rising technology expenses and a prolonged slowdown in the banking sector could easily challenge the growth assumptions behind this positive outlook.

Find out about the key risks to this FactSet Research Systems narrative.

Another View: Comparing Price-to-Earnings Ratios

While our fair value estimate suggests FactSet is undervalued, a look at its price-to-earnings ratio adds a different perspective. FactSet’s ratio is 17.9x, which is cheaper than both the industry average of 24.9x and its peers at 30.7x. However, it is still above the fair ratio of 15x that the market might eventually target. This means shares could remain vulnerable if investor sentiment changes, or there could be potential for further gains if optimism returns. How confident are you that the market will reward this discount?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own FactSet Research Systems Narrative

If you have a different take or want to dig deeper into the numbers, you can quickly craft your own FactSet story and perspective in just a few minutes, Do it your way.

A great starting point for your FactSet Research Systems research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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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.

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