A Bullish Price Surprise Says FactSet Research Stock Is Turning the Corner. How to Play FDS Here.

FactSet Research (FDS) jumped more than 6% on Monday, putting it on Barchart’s bullish price-surprises list for the day. Before you get too excited, FDS stock is giving back a good chunk of those gains in Tuesday Morning Trading.

The beleaguered financial services software stock hasn't been a winner for several years now, down 26% over the past five years.

If you’ve followed FactSet in the past year, you're likely aware that it's caught in the downdraft caused by investor fears about AI and what it will do to SaaS (software as a service) business models and pricing power. 

Not popular with analysts, FDS stock has hit new 52-week lows on 45 occasions in the past 12 months. However, despite investor malaise, the Barchart Technical Opinion is a 40% Buy in the near term. 

Always a glass-half-full investor, I believe that FDS’s Latest bullish price surprise indicates that the tide might be beginning to turn for the company’s stock.

Here’s why I feel this way. 

Once Bitten, Twice Shy?

My most recent commentary about FactSet was in February when I covered four stocks hitting new 52-week highs and lows. FactSet was one of the two hitting new 52-week lows; the other was direct competitor Thomson Reuters (TRI), one of Canada’s largest businesses. 

At the time, FDS had hit its 49th new 52-week low of the past 12 months at $185. I reckoned that veteran money manager Ron Baron adding 1.07 million FDS shares to Baron Capital’s existing stake in Q4 2025 -- bringing its stake to 7.7% -- suggested it was a beaten-down stock worth investors' consideration.  I concluded, “With a 2.3% yield, you get paid to wait for investors to come back around. They always do.”

FDS is up 36% over the past five months. A rare example of “Once Bitten, Twice Shy,” in a good way. 

Clearly, FDS stock is less cheap than it was in February, but it’s still down 13% in 2026 and 43% over the past year. It’s got a shot at maintaining its momentum in the second half to get into positive territory heading into 2027. 

What Baron Likes About FDS

I wish I could ask Ron Baron. Baron Capital increased its holdings in FDS by 30% in Q1 2026, to 3.77 million shares, accounting for 2.4% of Baron’s $36.91 billion in 13F assets. FactSet is Baron Capital’s 9th-largest holding among 327 holdings.  

While I can’t ask the man personally, he did say quite a bit about FactSet in a December 2025 CNBC interview. 

He was especially encouraged by the company's new CEO, Sanoke Viswanathan, who had been hired three months earlier. Baron invested in FactSet because he wanted an investment similar to Bloomberg, but since it was private, he decided it was a good alternative. He even compared Viswanathan to Jamie Dimon. That's high praise. 

Viswanathan spent 15 years at JPMorgan Chase (JPM) before taking the top job at FactSet, including 12 years overseas in the UK. Before that, he spent 11 years at McKinsey & Co. Viswanathan took the top job after learning he wouldn’t be in line to replace Dimon as JPMorgan’s CEO. JPMorgan’s loss is FactSet’s gain. 

“If you have a company that is this really cool company with great opportunities like a Bloomberg, but young and up and coming, and have guy like this, a killer guy like this ... think about putting Jamie Dimon at 51 or 52 in charge of this company. That’s what just happened,” Baron said in December.  

I can see why Baron likes the hire.  

What Else to Like

As I said in February, FactSet’s free cash flow (FCF) yield was 7.8%, approaching value territory. Today, given the appreciation in its stock, it’s 6.7%. I consider anything between 4% and 8% to be fair value. Translation: If you buy FDS stock now, you won’t be overpaying.

On June 30th, FactSet announced a strategic partnership with Google Cloud to bring Advanced AI to financial intelligence. The partnership hinges on three initiatives.

First, FactSet AI will have Gemini embedded in its Workstation, enhancing the FactSet research experience. Secondly, the partnership will ensure that the FactSet Workstation and Gemini Enterprise will operate seamlessly together to benefit financial professionals. Lastly, FactSet and Google Cloud will launch new agents built on the Gemini Enterprise Agent Platform to improve financial advisors’ portfolio operations, deal advisory, corporate finance capabilities and research.

Despite the fears that AI would hurt it, FactSet’s work with Google suggests it has plenty of ideas on how to compete in an AI world. 

One of FactSet’s ongoing positives is its recurring revenue, which the company refers to as ASV (annual subscription value). As of May 31, 2026, it was $2.48 billion, 7.1% higher than a year earlier, with all three of its operating regions delivering growth. Most importantly, it retained over 95% of its subscribers. 

Marketers often talk about a product’s stickiness—the extent to which a client engages with the product(s). In the first quarter, over 90% of the company’s top 50 clients used four or more of FactSet’s products. That’s an engaged customer base. 

In the 12 months ended May 31, it had 9,130 clients, 3.6% higher than a year earlier, with 247,766 financial professionals at those firms using FactSet’s products. As long as it’s adding new clients each year and its existing clients are using more products, that’s a recipe for success. It doesn’t need to be double-digit growth to achieve success as a business. 

I believe investors are underappreciating the enduring qualities of FactSet’s business. 

The Bottom Line on FactSet Stock

FactSet’s all-time high of $499.87 was reached on Nov. 14, 2024. In fiscal 2024 (August year-end), the company’s free cash flow was $614.6 million, 114.4% of its net income. In the trailing 12 months ended May 31, it was $708.3 million, 125.1% of its net income. 

It does a good job of converting net income into free cash flow, which it can then reinvest in the business, return to shareholders, use to make acquisitions, or pay down debt. 

Yet, its share price in November 2024 was double its current level, even though it converts net income to free cash flow more effectively. 

FactSet expects to earn $17.50 a share at the midpoint of its 2026 guidance. Its shares trade at 14.4 times that estimate. Except for earlier this year, the multiple hasn’t been lower at any other time in the past decade. 

Forget what analysts think. FactSet’s got a lot going for it; its future is bright. It remains one of the better buys in the S&P 500. 

It’s down but not out.