FactSet Research Systems (NYSE: FDS) provides
economic and financial information on tens of thousands of companies worldwide. The firm offers data from hundreds of databases, focusing on such areas as broker research, financial summaries and newswires. The company also provides software for use in downloading, manipulating and presenting financial data for investment analysis. Clients include investment managers, bankers, lawyers and corporations at all levels. The firm employs over 1,000 people in North America, Europe and the Pacific Rim. Reuters Group (NASDAQ: RTRSY) is a major competitor.
FactSet pleased investors last week, when it reported fiscal Q2 EPS of 62 cents and revenues of $140.2 million. Analysts had been looking for 60 cents and $139.6 million. Management also predicted Q3 revenues of $145-$149 million, versus Street consensus of $143.58 million.
The stock
popped into a bullish "flag" consolidation pattern on the news. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend FDS with one "strong buy", one "buy" and three "holds". Analysts expect an 18% average annual growth rate, through the next five years. The FDS Operating Margin (31.93%), Net Profit Margin (22.51%), Return on Assets (23.29%), Return on Investment (27.10%) and Return on Equity (28.74%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 93% of the outstanding shares. Over the past 52 weeks, the stock has traded between $43.04 and $73.99. A stop-loss of $48.70 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold a position in either of the stocks mentioned above.
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