Fair Isaac Corporation

Fair Isaac Corporation Simple & Connected Explanation 2025

Fair Isaac Corporation (FICO) is a company famous for its FICO Score, which banks and financial institutions use to check a person’s creditworthiness. Let’s break down its financials in a way that’s easy to understand.

Market Value & Stock Performance – How Big is the Fair Isaac Corporation ?

  • Market Cap: $41.29 billion → This is the total value of the company in the stock market. It tells us how big the company is.
  • Enterprise Value (EV): $43.72 billion → This includes the company’s debt and cash, giving a clearer picture of its real worth. Since EV is more than market cap, it means FICO has some debt.
  • Shares Outstanding: 24.42 million → The number of shares available in the market.
  • Share Reduction: -1.30% in the last year → The company bought back some of its shares. This is usually good for investors because it increases the value of remaining shares.

Stock Growth:- The stock price has gone up by 32.06% in the last year, which means it has given good returns to investors.

Fair Isaac Corporation

Is the Fair Isaac Corporation Stock Expensive?

To know whether a stock is cheap or expensive, we look at its PE Ratio (Price-to-Earnings Ratio).

  • Current PE Ratio: 78.49 → This means the Fair Isaac Corporation stock is trading at 78 times its past year’s earnings. A high PE usually means the stock is expensive.
  • Forward PE Ratio: 56.00 → This means the stock is expected to get cheaper based on future earnings, but it’s still high.
  • PEG Ratio: 1.74 → If this number is above 1, the stock might be overvalued. Since FICO’s PEG is 1.74, it is not very cheap.

Conclusion: The stock is expensive right now, but investors are willing to pay because they expect good growth in the future.

Is the Company Making Good Money ?

A good company should make a lot of profit from its business. Let’s see how Fair Isaac is doing:-

  • Revenue (Total Income): $1.78 billion → This is the total money the company made in the last 12 months.
  • Net Profit: $544.27 million → This is the actual profit left after all expenses.
  • Earnings Per Share (EPS): $21.79 → If you owned 1 share, this is how much profit is assigned to you.

To check how profitable a company is, we look at its margins:-

  • Gross Margin: 80.17% → For every $100 the company earns, $80.17 is left after production costs. This is very high!
  • Operating Margin: 42.91% → After paying for salaries, rent, and other business costs, the company keeps 42.91% of revenue.
  • Profit Margin: 30.66% → After all expenses, 30.66% of the revenue turns into profit.

Conclusion: Fair Isaac Corporation is a highly profitable company with strong margins, which is a great sign for investors.

Returns – How Efficient is the Company ?

Investors love companies that generate high returns on their money. Here’s how Fair Isaac performs:

  • Return on Assets (ROA): 28.85% → For every $100 in assets, the Fair Isaac Corporation makes $28.85 in profit.
  • Return on Invested Capital (ROIC): 37.09% → For every $100 invested, the company makes $37.09 in returns.
  • Return on Capital Employed (ROCE): 55.39% → This shows how well the company uses its capital.

Conclusion: Fair Isaac is highly efficient, making good use of its money and assets to generate profits.

Fair Isaac Corporation

Financial Strength – Is There Any Risk ?

A company should have more cash than debt to be financially strong. Let’s check Fair Isaac’s position:

  • Cash: $184.25 million → This is the total cash the Fair Isaac Corporation has.
  • Debt: $2.44 billion → This is the total money the company owes.
  • Net Cash Position: -$2.26 billion → Since debt is much higher than cash, the company has a negative cash position, meaning it owes more than it has.

Conclusion: Fair Isaac is profitable but carries a lot of debt, which is a risk. However, since it generates strong profits, it can manage this debt.

Stock Volatility & Investor Sentiment – How Risky is It ?

  • Beta: 1.39 → A beta above 1 means the Fair Isaac Corporation stock is more volatile than the market. Fair Isaac’s stock moves up and down more than the average stock.
  • Short Interest: 2.73% → This means some investors are betting against the stock, but the percentage is not too high.

Conclusion: This stock can be risky because of its high volatility, but overall, investor sentiment is positive.

Analyst Ratings & Future Expectations :-

  • Average Price Target: $2,089.69 → Analysts believe the stock can go 23.59% higher from its current price.
  • Consensus Rating: “Buy” → Most analysts recommend buying this stock.

Conclusion: Experts believe Fair Isaac Corporation’s stock price will continue to increase, making it an attractive investment.

Should You Buy Fair Isaac Corporation Stock ?

✅ Reasons to Buy:

  1. Highly Profitable: Strong margins and earnings.
  2. High Returns on Capital: Efficient use of money and assets.
  3. Growing Stock Price: Increased by 32% in the last year.
  4. Positive Analyst Ratings: Expected 23.59% upside.
  5. Industry Leader: Dominates the credit scoring industry.

❌ Reasons to Avoid:

  1. Expensive Valuation: High PE ratio (78.49).
  2. High Debt: More debt than cash (-$2.26 billion).
  3. Stock is Volatile: Beta of 1.39 means price fluctuations.
  4. Short Interest Exists: 2.73% of shares are shorted.

Buy or Wait ?

  • If you want a profitable and fast-growing company, Fair Isaac is a good investment.
  • If you are looking for a cheap stock or a low-risk investment, you might want to wait for a better price.

Disclaimer

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Investing in the stock market involves risks, and past performance is not indicative of future results. We strongly recommend that investors conduct their own research, consult with a certified financial advisor, and carefully consider their financial goals before making any investment decisions.

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