Our Take Stock product (the one that you can use here) gives Factset a quality rating of 10, notes that investor interest in FDS is strong, and calculates a buy price that is $63.65 or so. 

Mr. Market knocked FDS down to $62.01 today, so it is in the buy range ...

My recommendation is that you might want to take a good hard look at this one.  I'd be looking at all of the companies rated 6 or more (use the Stock Screener to find out which these are!).  And, given that the market is taking down a lot of good companies, this is probably a good time to put Mark Robertsons truck in reverse and start to back it toward the loading dock!

West McGahee asks “what do you think of FDS is it a buy right now”.

Well, it all depends on what you consider as “good judgment”.

- Take Stock Online says FDS is almost a Buy, with a current price of $64.10 just pennies ($0.45 per share) more than its SSG Buy Price.  However, Take Stock relies on a Forecast High Price of $149.33 which is a whopping 49% more than Value Line’s estimated $65-100 High Price in the next 3-5 years.

Any stock can be made a BUY if you’re willing to rely on unusually high judgments…..just like any stock can be made a SSG DON’T-BUY if you use unusually conservative judgments.  Exceeding VL’s estimate by 49% is way too much for me.

- I also did not get a BUY when my SSG exceeded VL’s estimate by 21%.  FDS would have to drop some $7.00 per share to be a BUY with those judgments.  And, except for our Forecast High Prices, this SSG and Take Stock’s are pretty close to one another.

- I’m still not comfortable with exceeding VL by 21% per share.  So I did a second SSG, where I exceeded VL by 11% and FDS now would have to drop some $11 per share, to around $53, to be a SSG BUY. 

Here’s how the three SSGs compare:

I wrote a long message yesterday agreeing that your SSG-1 wasn't something that I really could argue with.

Then I started to argue with you, and then accidentally erased the message.

As I see it, the really important difference is in the choice for high P/E.  You're being conservative, but you're also making a projection of a high P/E that's still lower than the lowest high P/E in the last 5 years.  I can understand what you did, but do you really think that the high P/E will decline to a value below it's historical low?  And, mind you, you're projecting a growth rate that is only somewhat lower than the historical growth rate.

So, I think that I could argue that the Take Stock projection is not that out of line.

Maybe we should just warm up the truck and keep it in park?   We're arguing about the buy price.  I think that we both agree that FDS is a quality company ... at least I hope that we do!

Joe:

It’s good to discuss SSGs, even better would be for you to share your SSG.  Then we could discuss your judgments, not just mine.

Joe Craig wrote: “So, I think that I could argue that the Take Stock projection is not that out of line.”

Take Stock’s High Price is way, way out of line, some 49% higher than Value Line’s High Price, which you chose to ignore and which your argument needs to deal with.  I wasn’t willing to forecast a High Price that was 21% higher than VL, much less 42% higher.  How high are you willing to go?

Our disagreement is not merely over the Buy Price, but (A) whether FDS is overvalued when we use good judgment and (B) whether Take Stock’s judgment for FDS can be characterized as poor.

Armin

Joe Craig said: "So ... everywhere else your SSG-1 pretty much is in agreement with Take Stock. And, your SSG-1 has FDS right on the cusp of being in the buy range: U/D is 2.9+ and the total return is 14.9+. Even with your analysis, if it is overvalued, it is not overvalued by much."

I did misstate your numbers.

But, do we agree that FDS us a good company?  Are we discussing more that the price at which to buy it?