FactSet Research Systems' (FDS) near-term annual subscription value growth is likely to continue to accelerate while the company's stock is pricing in low-single-digit growth, which should drive the shares higher, UBS said in a Monday note.

UBS also said FactSet's recent ASV growth of $82 million represented the largest quarter in the company's history as it continued to "execute well" in the wealth segment. Meanwhile, new initiatives, like real-time data and managed services, gained traction.

Noting artificial intelligence adoption, UBS also said it believed that FactSet is positioned to perform well against technological changes as financial services end markets move slowly amid complexities and regulatory demands.

UBS now expects revenue and EPS growth of 6% and 3%, respectively, in 2026. Topline and bottomline growth are expected to be 5% and 9%, respectively, for fiscal 2027. Meanwhile, UBS further cut its 2026 adjusted operating margin forecast to 35% from 36.6%, which is in line with the company estimate of 34% to 36%.

The firm upgraded its rating to buy from neutral, while reducing its price target to $425 from $480.

Price: 300.17, Change: +11.02, Percent Change: +3.81