Patience is a virtue, especially at the Börse. The history of FactSet is a lesson in timing, discipline and doubt.
Why patience on the stock market
is the most important virtue
You never stop learning on the stock market. Although there are mechanisms that - if you have really internalized them - virtually guarantee stock market success, you never stop learning.
And there are always surprises on the stock market. It never gets boring, the stock market is far too complicated and multi-layered for that.
The greatest virtue and the greatest success factor on the stock market are patience and discipline. I have been following FactSet, for example, for several years now, but in my view the share has always been overvalued and the risk/reward ratio has never been good enough.
But if you have patience, sooner or later you will have the opportunity to enter every share at a good price. Cheap means that the valuation is low. A share can be too expensive today at USD 50 and be cheap a few years later at USD 100.
Getting this right is the real art.
A solid success story
FactSet Research Systems Inc. is one of the leading providers of financial information, financial data and software solutions.
The company's services include the provision of analytics, research and data management solutions used for investment decisions and strategies.
FactSet offers a comprehensive platform that integrates data from various sources, including market and financial data, company reports, news and other relevant information.
A key feature of FactSet is its ability to consolidate data from different sources and make it available in a unified platform. This enables seamless integration and ease of use, making the analysis process more efficient.
The strengths of FactSet
The platform enables users to perform customized analyses, create models and generate reports tailored to their specific needs.
In addition, FactSet offers powerful analytical tools to help users identify trends, perform risk assessments and make informed investment decisions.
It also provides comprehensive training and support services to ensure that clients can realize the full potential of the solutions offered.
FactSet serves a wide range of clients, including investment managers, financial analysts, portfolio managers, risk managers, asset managers and investment bankers.
Impressive business figures
Most stock market participants come into contact with FactSet on a daily basis without realizing it. This is because a large proportion of all stock market portals obtain the fundamental data and estimates for the future turnover, profit etc. of all companies from FactSet.
Personally, I use FactSet on a daily basis.
FactSet has become a permanent fixture in the stock market environment. In the last five years, sales have increased massively from USD 1.49 billion to USD 2.32 billion.
At the same time, profitability has improved slightly. Earnings have increased from USD 11.20 to USD 16.98 per share
Total crash
Anyone looking at the figures will hardly be surprised that the share price has also performed well.
In recent months, however, the share price has collapsed completely, and if you look at the figures, you wonder why. FactSet delivered a record result in the financial year just ended, which ran until the end of August.
At first glance, the crash looks like an invitation to invest - and perhaps it really is.
But one thing is certain: those who have been patient in recent years have been rewarded. Every share comes under pressure at some point. Every one.
However, there are a few other virtues on the stock market besides patience. One of them is to avoid unnecessary risks - and this is precisely why I personally decided against investing.
That's just how it goes sometimes. You watch a share for years (in this case it's probably been around 4-5 years), wait for a crash and still decide against it in the end.
The reason for this is simple. In my view, it is extremely difficult to predict what will happen next with FactSet. There is a serious risk that the business model will be at least partially disrupted by KIdisrupted.
How artificial intelligence
threatens the business model
While this is not an option for fund managers, many private investors are likely to have information collected and analyzed by AI in the future instead of relying on information sources that cost money.
This in turn means that services that use data from FactSet and package it for a fee could experience lower demand and less money coming into FactSet.
It is difficult to predict how much of an impact this will have on the business. The impact may be less than one would expect, but it may also be a tectonic shift within the industry. Nobody can really predict end consumer behavior - if you can, you should make it your job, you would be worth it for any business. Goldworth.
In the fiscal year just ended, FactSet was only able to increase earnings by 3% to $16.45 per share.
This is not the first weak year in the company's history, and if this turns out to be just a brief lull, then the stock should prove to be a good investment.
However, if the business model is partially disrupted by AI, things could look completely different.
In fact, the company itself seems to be unsure. The Executive Board has presented a very cautious forecast for the new financial year and only predicted earnings of USD 16.90-17.60 per share.
At the lower end of the range, this would correspond to a slight decline in earnings and even at the upper end, only a 4% increase
FactSet share: Chart from 04.11.2025, price: USD 264.57 - symbol: FDS | Source: TWS
The weak performance in the last financial year therefore appears to be more than just a brief dip.
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