On Monday, BMO Capital Markets updated its outlook on FactSet Research Systems (NYSE:FDS), increasing the company's share price target to $458 from $447 while maintaining a Market Perform rating. The adjustment follows FactSet's reported earnings per share (EPS) that surpassed expectations, attributed to stringent cost management and specific personnel measures.
The company's performance, especially in the sell-side Annual Subscription Value (ASV) growth, exhibited a slight deceleration beyond initial projections. Despite this, FactSet has reaffirmed its fiscal year 2024 adjusted EPS guidance. However, management now anticipates revenue growth to be at the lower end of the previously forecasted range, around 5.5%, which is slightly below the consensus.
For the third fiscal quarter of 2024 (F3Q24), the company expects to see some softness, with an anticipated uptick in activity during the fourth fiscal quarter (F4Q24). In response to these developments, BMO Capital Markets has revised its estimates alongside the updated price target for FactSet.
The new price target of $458 reflects BMO's adjusted expectations based on the latest financial data and outlook provided by FactSet. This move indicates a response to the company's disciplined approach to managing expenses and the resulting better-than-expected adjusted EPS, despite the slower ASV growth on the sell-side and the conservative revenue growth forecast.
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