FactSet Research Systems Inc (FDS, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $430.09, FactSet Research Systems Inc has witnessed a daily gain of 0.71%, marked against a three-month change of -5.97%. A thorough analysis, underlined by the GF Score, suggests that FactSet Research Systems Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 6/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 7/10
- Momentum rank: 8/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With a high profitability and growth rank, and a slightly lower but still strong financial strength rank, GuruFocus assigned FactSet Research Systems Inc the GF Score of 97 out of 100, which signals the highest outperformance potential.
Understanding FactSet Research Systems Inc Business
FactSet Research Systems Inc, with a market cap of $16.39 billion and sales of $2.15 billion, operates at an impressive operating margin of 31.81%. The company provides financial data and portfolio analytics to the global investment community, aggregating data from various sources into its workstations. It also offers essential portfolio analytics used for monitoring portfolios and addressing reporting requirements. Buy-side clients make up 82% of FactSet's annual subscription value. The company's strategic acquisitions, such as Portware in 2015, BISAM in 2017, and CUSIP Global Services in 2022, have bolstered its offerings in trade execution software and risk management.
Financial Strength Breakdown
According to the Financial Strength rating, FactSet Research Systems Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for FactSet Research Systems Inc stands impressively at 10.32, underscoring its strong capability to cover its interest obligations. This robust financial position resonates with the wisdom of legendary investor Benjamin Graham, who favored companies with an interest coverage ratio of at least 5. With an Altman Z-Score of 6.28, FactSet Research Systems Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. With a favorable Debt-to-Revenue ratio of 0.79, FactSet Research Systems Inc's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows FactSet Research Systems Inc's impressive standing among its peers in generating profit. The company's Operating Margin has increased over the past five years, indicating a consistent improvement in profitability. FactSet Research Systems Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, FactSet Research Systems Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 11.5%, which outperforms better than 62.83% of companies in the Capital Markets industry. Moreover, FactSet Research Systems Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years, with a three-year growth rate of 13.3 and a five-year rate of 11.6. This trend accentuates the company's continued capability to drive growth.
Next Steps
Considering FactSet Research Systems Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking similar opportunities can explore more companies with strong GF Scores using the following screener link: GF Score Screen. With its solid financial foundation and proven growth trajectory, FactSet Research Systems Inc stands as a compelling choice for value investors looking to capitalize on market outperformance.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
