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Here's What Analysts Are Forecasting For FactSet Research Systems Inc. (NYSE:FDS) After Its Second-Quarter Results

Simply Wall St
·4 mins read

Shareholders of FactSet Research Systems Inc. (NYSE:FDS) will be pleased this week, given that the stock price is up 17% to US$255 following its latest second-quarter results. Results were roughly in line with estimates, with revenues of US$370m and statutory earnings per share of US$2.30. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for FactSet Research Systems

NYSE:FDS Past and Future Earnings March 28th 2020
NYSE:FDS Past and Future Earnings March 28th 2020

Taking into account the latest results, FactSet Research Systems's 16 analysts currently expect revenues in 2020 to be US$1.49b, approximately in line with the last 12 months. Statutory earnings per share are expected to dip 5.0% to US$9.15 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.49b and earnings per share (EPS) of US$9.19 in 2020. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$236, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values FactSet Research Systems at US$306 per share, while the most bearish prices it at US$185. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that FactSet Research Systems's revenue growth is expected to slow, with forecast 1.8% increase next year well below the historical 8.7%p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.8% per year. 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 obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that FactSet Research Systems's revenues are 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for FactSet Research Systems going out to 2024, and you can see them free on our platform here..

You can also view our analysis of FactSet Research Systems's balance sheet, and whether we think FactSet Research Systems is carrying too much debt, for free on our platform here.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.