Critical Comparison: FactSet Research Systems (FDS) and Its Peers

FactSet Research Systems (NYSE:FDS) is one of 1,743 publicly-traded companies in the “Capital Markets” industry, but how does it weigh in compared to its rivals? We will compare FactSet Research Systems to similar businesses based on the strength of its risk, profitability, earnings, dividends, institutional ownership, valuation and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings for FactSet Research Systems and its rivals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FactSet Research Systems	6	10	2	1	1.89
FactSet Research Systems Competitors	5561	20139	22479	642	2.37

FactSet Research Systems currently has a consensus target price of $278.57, indicating a potential downside of 15.09%. As a group, “Capital Markets” companies have a potential upside of 26.73%. Given FactSet Research Systems’ rivals stronger consensus rating and higher possible upside, analysts clearly believe FactSet Research Systems has less favorable growth aspects than its rivals.

Valuation and Earnings

This table compares FactSet Research Systems and its rivals gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
FactSet Research Systems	$2.48 billion	$533.48 million	22.53
FactSet Research Systems Competitors	$5.22 billion	$399.10 million	17.84

FactSet Research Systems’ rivals have higher revenue, but lower earnings than FactSet Research Systems. FactSet Research Systems is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Dividends

FactSet Research Systems pays an annual dividend of $4.64 per share and has a dividend yield of 1.4%. FactSet Research Systems pays out 31.9% of its earnings in the form of a dividend. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 29.1% of their earnings in the form of a dividend. FactSet Research Systems has increased its dividend for 27 consecutive years. FactSet Research Systems lags its rivals as a dividend stock, given its lower dividend yield and higher payout ratio.

Insider and Institutional Ownership

91.2% of FactSet Research Systems shares are held by institutional investors. Comparatively, 30.5% of shares of all “Capital Markets” companies are held by institutional investors. 1.2% of FactSet Research Systems shares are held by insiders. Comparatively, 13.1% of shares of all “Capital Markets” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares FactSet Research Systems and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FactSet Research Systems	21.54%	31.66%	15.73%
FactSet Research Systems Competitors	318.24%	11.44%	3.69%

Volatility and Risk

FactSet Research Systems has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, FactSet Research Systems’ rivals have a beta of 0.81, meaning that their average share price is 19% less volatile than the S&P 500.

Summary

FactSet Research Systems rivals beat FactSet Research Systems on 9 of the 15 factors compared.

FactSet Research Systems Company Profile

FactSet Research Systems Inc., a financial data company, provides integrated financial information and analytical applications to the investment community in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company delivers insight and information through the workflow solutions of research, analytics and trading, content and technology solutions, and wealth. It serves portfolio managers, investment banks, asset managers, wealth advisors, corporate clients, and other financial services entities. FactSet Research Systems Inc. was founded in 1978 and is headquartered in Norwalk, Connecticut.