📊 FDS Key Takeaways
Is Factset Research Systems Inc. (FDS) a Good Investment?
FactSet demonstrates exceptional profitability fundamentals with 29.5% operating margins and 22.4% net margins, coupled with industry-leading free cash flow generation of $530.2M (28.8% FCF margin). However, flat net income growth despite 5.4% revenue expansion and a concerning 0.68x current ratio warrant cautious optimism rather than strong conviction.
FactSet demonstrates high-quality profitability, with a 29.5% operating margin, 22.4% net margin, and free cash flow exceeding net income. Revenue growth is moderate and net income is flat, but strong cash generation, solid returns on capital, and comfortable interest coverage support a positive fundamental outlook despite liquidity and leverage concerns.
Factset Research Systems Inc. Key Strengths (FDS)
- Exceptional operating margin of 29.5% and net margin of 22.4% indicating strong pricing power and operational efficiency in data/software business
- Outstanding free cash flow generation of $530.2M exceeding net income, demonstrating earnings quality and cash conversion capability
- Robust return on equity of 20.3% with healthy leverage (0.68x debt/equity) and excellent interest coverage of 13.5x enabling financial stability
- Diluted EPS growth of 11.8% YoY despite flat net income reflects disciplined capital allocation through share buybacks
- Consistent 5.4% revenue growth in mature software/data processing sector shows sustained market demand
- Strong free cash flow of $530.17M with a 28.8% FCF margin
- High operating and net margins of 29.5% and 22.4%
- Healthy ROE of 20.3% and interest coverage of 13.5x
FDS Stock Risks: Factset Research Systems Inc. Investment Risks
- Current ratio and quick ratio both at 0.68x indicate near-term liquidity constraints requiring close monitoring despite strong operating cash flow
- Net income flat YoY (0.0%) while revenue grew 5.4% signals operating leverage not converting to bottom-line expansion; margin compression risk
- Moderate 5.4% revenue growth may indicate market saturation or competitive pressures in core business segments
- Long-term debt of $1.4B creates meaningful financial obligation; refinancing risk if interest rates remain elevated
- Minimal insider buying activity (1 Form 4 filing in 90 days) provides no management confidence signal regarding valuation
- Net income was flat despite 5.4% revenue growth, indicating limited earnings conversion
- Current and quick ratios of 0.68x signal constrained short-term liquidity
- Long-term debt of $1.39B materially exceeds cash and equivalents of $288.11M
Key Metrics to Watch
- Operating margin sustainability - current 29.5% is a competitive moat; monitor for erosion from pricing pressure or cost inflation
- Free cash flow conversion ratio and deployment strategy - critical for debt reduction and addressing liquidity concerns
- Revenue growth acceleration trajectory - determine if 5.4% is floor or if market headwinds are structural
- Current ratio improvement - must move above 0.90x to eliminate near-term liquidity concerns
- Net income margin expansion - assess whether bottom-line can catch up to top-line growth momentum
- Organic revenue growth and operating margin
- Net debt reduction and free cash flow conversion
Factset Research Systems Inc. (FDS) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 28.8% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. The current ratio below 1.0x warrants monitoring of short-term liquidity.
FDS Profit Margin, ROE & Profitability Analysis
FDS vs Technology Sector: How Factset Research Systems Inc. Compares
How Factset Research Systems Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Factset Research Systems Inc. Stock Overvalued? FDS Valuation Analysis 2026
Based on fundamental analysis, Factset Research Systems Inc. has mixed fundamental signals relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Factset Research Systems Inc. Balance Sheet: FDS Debt, Cash & Liquidity
FDS Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Factset Research Systems Inc.'s revenue has grown significantly by 46% over the 5-year period, indicating strong business expansion. The most recent EPS of $12.04 reflects profitable operations.
FDS Revenue Growth, EPS Growth & YoY Performance
FDS Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $585.5M | $126.7M | $3.50 |
| Q2 2026 | $570.7M | $133.1M | $3.59 |
| Q1 2026 | $568.7M | $150.0M | $3.89 |
| Q3 2025 | $552.7M | $148.5M | $3.87 |
| Q2 2025 | $545.9M | $140.9M | $3.65 |
| Q1 2025 | $542.2M | $148.6M | $3.84 |
| Q3 2024 | $529.8M | $134.7M | $3.46 |
| Q2 2024 | $515.1M | $131.6M | $3.38 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Factset Research Systems Inc. Dividends, Buybacks & Capital Allocation
FDS SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Factset Research Systems Inc. (CIK: 0001013237)
📋 Recent SEC Filings
❓ Frequently Asked Questions about FDS
What is the AI rating for FDS?
Factset Research Systems Inc. (FDS) has a Combined AI Grade of A from Claude (A) and ChatGPT (A) with 82% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are FDS's key strengths?
Claude: Exceptional operating margin of 29.5% and net margin of 22.4% indicating strong pricing power and operational efficiency in data/software business. Outstanding free cash flow generation of $530.2M exceeding net income, demonstrating earnings quality and cash conversion capability. ChatGPT: Strong free cash flow of $530.17M with a 28.8% FCF margin. High operating and net margins of 29.5% and 22.4%.
What are the risks of investing in FDS?
Claude: Current ratio and quick ratio both at 0.68x indicate near-term liquidity constraints requiring close monitoring despite strong operating cash flow. Net income flat YoY (0.0%) while revenue grew 5.4% signals operating leverage not converting to bottom-line expansion; margin compression risk. ChatGPT: Net income was flat despite 5.4% revenue growth, indicating limited earnings conversion. Current and quick ratios of 0.68x signal constrained short-term liquidity.
What is FDS's revenue and growth?
Factset Research Systems Inc. reported revenue of $1.8B.
Does FDS pay dividends?
Factset Research Systems Inc. pays dividends, with $122.7M distributed to shareholders in the trailing twelve months.
Where can I find FDS SEC filings?
Official SEC filings for Factset Research Systems Inc. (CIK: 0001013237) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is FDS's EPS?
Factset Research Systems Inc. has a diluted EPS of $11.16.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is FDS's fundamental grade?
Based on our AI fundamental analysis in August 2026, Factset Research Systems Inc. has a A grade with 82% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is FDS stock overvalued or undervalued?
Valuation metrics for FDS: ROE of 20.3% (sector avg: 22%), net margin of 22.4% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
What is FDS's AI grade for 2026?
Our dual AI analysis gives Factset Research Systems Inc. a combined A grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is FDS's free cash flow?
Factset Research Systems Inc.'s operating cash flow is $617.5M, with capital expenditures of $87.3M. FCF margin is 28.8%.
How does FDS compare to other Technology stocks?
Vs Technology sector averages: Net margin 22.4% (avg: 18%), ROE 20.3% (avg: 22%), current ratio 0.68 (avg: 2.5).