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FactSet Research Systems Inc. (FDS) Earnings: An Early Look

XLF puts see heavy volume; FactSet options active ahead of earnings

Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and FactSet Research Systems Inc. (NYSE:FDS) is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Investment professionals need a lot of back-office support to help them manage their businesses, and FactSet Research Systems Inc. (NYSE:FDS) helps provide an information platform that allows them to integrate multiple sources of data into more accessible applications. With the financial industry having largely recovered over the past five years, now seems to be a good time for FactSet to boost its business. Let’s take an early look at what’s been happening with FactSet Research over the past quarter and what we’re likely to see in its quarterly report on Tuesday.

Stats on FactSet Research

Analyst EPS Estimate $1.11
Change From Year-Ago EPS 8.8%
Revenue Estimate $213.3 million
Change From Year-Ago Revenue 7%
Earnings Beats in Past 4 Quarters 3

Source: Yahoo! Finance.

Will FactSet Research get the facts right this quarter?
Analysts have been a bit more cautious about their views on FactSet Research Systems Inc. (NYSE:FDS) in recent months, cutting $0.02 per share off their earnings estimates for the just-ended quarter and a full dime from their fiscal-year 2013 consensus on earnings per share. But the stock hasn’t responded too badly to that caution, rising about 6% since mid-December.

FactSet Research Systems Inc. (NYSE:FDS) has done a remarkably good job of sustaining its business throughout the difficulties plaguing the financial industry over the past five years. The company managed to keep both revenue and profits growing even in 2008 and 2009, when many of its clients were reining back on their financial business. That growth has only accelerated more recently, as conditions in the industry have improved.

Yet FactSet Research Systems Inc. (NYSE:FDS) is poised to see ever-increasing competition. Privately held Bloomberg has always been a strong competitor, but offerings from The McGraw-Hill Companies, Inc. (NYSE:MHP)‘s S&P Capital IQ division as well as Thomson Reuters Corporation (USA) (NYSE:TRI) are geared toward duplicating some of the success that FactSet has had in providing financial information.

Still, both S&P and Thomson Reuters tend to focus on news and other fundamentally based information. FactSet Research Systems Inc. (NYSE:FDS), by contrast, has done a good job of providing not only hard financial data but also portfolio simulations and valuation tools, catering specifically to professionals who need tools to give their clients the predictions and advice that they want.

In its quarterly report, watch for FactSet to talk about the impact that the stock market’s record run is having on its business. As interest in investing rises, so too should FactSet’s opportunity to make an even bigger impact on the financial world.

The article FactSet Research Earnings: An Early Look originally appeared on Fool.com.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends FactSet Research Systems (NYSE:FDS).

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