FactSet Beats ASV Estimates, Margins Pressured by Investments, Morgan Stanley Says

MT Newswires Live04-01

FactSet Research Systems (FDS) reported "better-than-expected" annual subscription value growth, though increased investments pressured margins, Morgan Stanley said in a report emailed Wednesday.

Organic ASV growth was 6.7% and revenue increased 7.1%, both beating expectations, but adjusted operating margin missed forecasts due to higher spending on compensation, cloud infrastructure and artificial intelligence initiatives, the firm said.

The company raised ASV growth guidance to a range of $130 million to $160 million, above prior estimates and consensus, but left the margin outlook unchanged, citing expectations for continued elevated investment, particularly into the second half of fiscal 2026, according to the note.

Morgan Stanley said accelerating ASV growth signals improving business momentum driven by demand for "real-time data," AI-related offerings and pricing gains, but noted that ongoing "reinvestment" could limit margin expansion relative to peers.

Morgan Stanley maintained an equal-weight rating on FactSet and cut its price target to $228 from $307.

Price: 223.17, Change: +6.18, Percent Change: +2.85

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