FactSet’s recurring revenue model performs well, but it is not immune to macro-environmental volatility

FactSet has built a compelling subscription-based business providing data and analytics to the financial services industry. FactSet is best known for its research solutions, which include a core desktop offering aimed at buy-side asset managers and sell-side investment bankers. Research is the largest component of the company’s annual subscription value, but it is FactSet’s slowest-growing segment due to its maturity and pressure on asset managers. Additionally, as acquisition volume has declined, it has put pressure on investment banking in FactSet’s research business.