Fair Isaac
| CURRENT PRICE | PROBABILITY-WEIGHTED FAIR VALUE | FAIR VALUE RANGE |
|---|---|---|
| $1,215.22 | ~$1,150 | $890 – $1,425 |
| May 2026 | Bull 25% / Base 50% / Bear 25% | Approximately fair; rich multiple |
Verdict: FICO posted record Q2 FY26 revenue of $692M and EPS of $11.14 (non-GAAP $12.50)[1], raising FY26 guidance to $2.45B revenue and $35.60 GAAP EPS. The mortgage-score pricing increase (Tri-merge to $4.95) and continued enterprise score volumes drove the beat. At 24x forward P/E, FICO commands a premium for its toll-road monopoly position in US credit underwriting — but the multiple is now elevated even by historical standards. PEG ratio of 0.87 suggests room remains if growth holds.
CURRENT SNAPSHOT
| Metric | Value | Notes / Source |
|---|---|---|
| Stock price | $1,194 | Trading range $1,150-$1,204 [2] |
| Q1 FY26 revenue | $512M | Q1 EPS $6.61 GAAP [3] |
| Q2 FY26 revenue | $692M | Net income $264.5M [1] |
| Q2 FY26 non-GAAP EPS | $12.50 | vs $7.81 prior year [1] |
| FY26 revenue guide | $2.45B | Raised [1] |
| FY26 GAAP EPS guide | $35.60 | [1] |
| Forward P/E | 24.2x | Trailing 37.6x [3] |
| EV/EBITDA | 28.7x | [4] |
BULL / BASE / BEAR SCENARIOS
| Scenario (weight) | Assumptions | Fair Value |
|---|---|---|
| Bull (25%) | Mortgage origination cycle recovery, additional pricing actions, 35x forward P/E | $1,425 |
| Base (50%) | Hit guide, +15% EPS growth, multiple holds 30x | $1,150 |
| Bear (25%) | Regulatory pricing scrutiny, multiple compresses to 22x forward | $890 |
| Probability-weighted | Toll-road monopoly; valuation supports current price but limits upside. | ~$1,150 |
Key Risks
- Regulatory pricing: CFPB and lender pushback on mortgage-score pricing increases; antitrust scrutiny possible.
- Mortgage cycle: Tied to home transactions; high rates suppress volumes.
- Alternative data: Long-term threat from alternative-data underwriting (VantageScore, custom models).
- Stock concentration: Heavily owned by quality-growth funds; positioning unwind risk.
What Would Change Our View
- Upside: Mortgage cycle recovery, additional pricing, software platform growth.
- Downside: Regulatory pricing cap, mortgage volumes decline, multiple compression.
Sources
[1] https://www.sec.gov/Archives/edgar/data/0000814547/000081454726000020/exhibit991erq22026.htm
[2] https://finance.yahoo.com/quote/FICO/
[3] https://stockanalysis.com/stocks/fico/statistics/
[4] https://www.alphaspread.com/security/nyse/fico/relative-valuation/ratio/enterprise-value-to-ebitda
Disclaimer
This output is for informational and research-assistance purposes only. It does not constitute investment, legal, tax, accounting, or other professional advice, and it is not a recommendation to buy, sell, or hold any security. Verify material facts independently and consult qualified advisors before making decisions.