Value
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.1 |
| P/S | 1.6 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 5.7 |
| PEG | 8.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 22.7x
- ▸PEG: 0.83
FICO · Why this verdict
Why Fair Isaac (FICO) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictBUY WAIT
Overall score6.6/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
At a PEG of 0.79 with 39% revenue growth and a quality profile in the top tier of software companies, the fundamental case is compelling — but a confirmed price downtrend and a death cross in place argue for waiting on technical confirmation before entering.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue is growing 39% year over year while the stock trades at a PEG ratio of 0.79, implying the market is pricing in significant growth deceleration — an asymmetry that favors patient buyers if the growth rate holds. Valuation breakdown | Revenue growth stays above 25% year over year for the next two fiscal quarters without a downward reset in guidance. | →Stable |
| CounterThe forward P/E at 21.7x is elevated on a headline basis, and any deceleration from 39% would remove the growth-at-a-discount argument and could trigger multiple compression. | ||
Banking clients represent 92% of revenue and the top three credit bureaus account for 51% — concentrating revenue risk in a narrow set of counterparties whose collective influence over contract terms and renewal cycles is substantial. Bear case | Revenue concentration in the top three bureau customers remains below 60% over the next 12 months as non-bureau revenue segments grow faster than the core. | ↑Improving |
| CounterDeep integration into credit decisioning at major financial institutions creates high switching costs that reinforce these relationships; the same concentration that creates contractual risk also provides durable revenue visibility. | ||
The business achieves 34% net margins, a Rule of 40 score of 71, and a perfect Piotroski F-Score of 9 out of 9 — a combination that places it among the top-ranked software franchises on operational excellence and financial health. Quality breakdown | Net margins hold above 30% and the Rule of 40 remains above 60 across the next four fiscal quarters. | →Stable |
| CounterThe three major credit bureaus account for 51% of revenue, meaning a pricing dispute or contract renegotiation with any one of them could rapidly compress margins with limited ability to diversify away. | ||
The company has beaten EPS estimates in all four of the past four quarters — most recently by approximately 14% — with an average upside surprise of 8.5%, reflecting a consistent pattern of under-promising and over-delivering. Earnings | Earnings beat streak extends to six consecutive quarters, with positive upward revisions to forward estimates following each print. | →Stable |
| CounterWith implied volatility at 84%, the options market is pricing substantial binary risk around each earnings event; a miss after four consecutive beats would likely be severely penalized. | ||
The stock is below its 200-day moving average with the average slope declining approximately 2.5% over the past 30 days, volume is distributing on a falling on-balance basis, and a death cross is in place — a technical configuration that suggests continued near-term weakness. Momentum breakdown | For this headwind to clear, the stock must recross above its 200-day moving average on expanding volume and sustain the breakout for at least four consecutive weeks. | ↓Deteriorating |
| CounterWith roughly 16% upside to the analyst price target and a risk/reward approaching 4-to-1 in the buyer's favor, current levels may represent an attractive entry for investors who can tolerate near-term technical weakness while waiting for fundamentals to reassert. | ||
Revenue is growing 39% year over year while the stock trades at a PEG ratio of 0.79, implying the market is pricing in significant growth deceleration — an asymmetry that favors patient buyers if the growth rate holds.
→StableValuation breakdown
- Expectation
- Revenue growth stays above 25% year over year for the next two fiscal quarters without a downward reset in guidance.
CounterThe forward P/E at 21.7x is elevated on a headline basis, and any deceleration from 39% would remove the growth-at-a-discount argument and could trigger multiple compression.
Banking clients represent 92% of revenue and the top three credit bureaus account for 51% — concentrating revenue risk in a narrow set of counterparties whose collective influence over contract terms and renewal cycles is substantial.
↑ImprovingBear case
- Expectation
- Revenue concentration in the top three bureau customers remains below 60% over the next 12 months as non-bureau revenue segments grow faster than the core.
CounterDeep integration into credit decisioning at major financial institutions creates high switching costs that reinforce these relationships; the same concentration that creates contractual risk also provides durable revenue visibility.
The business achieves 34% net margins, a Rule of 40 score of 71, and a perfect Piotroski F-Score of 9 out of 9 — a combination that places it among the top-ranked software franchises on operational excellence and financial health.
→StableQuality breakdown
- Expectation
- Net margins hold above 30% and the Rule of 40 remains above 60 across the next four fiscal quarters.
CounterThe three major credit bureaus account for 51% of revenue, meaning a pricing dispute or contract renegotiation with any one of them could rapidly compress margins with limited ability to diversify away.
The company has beaten EPS estimates in all four of the past four quarters — most recently by approximately 14% — with an average upside surprise of 8.5%, reflecting a consistent pattern of under-promising and over-delivering.
→StableEarnings
- Expectation
- Earnings beat streak extends to six consecutive quarters, with positive upward revisions to forward estimates following each print.
CounterWith implied volatility at 84%, the options market is pricing substantial binary risk around each earnings event; a miss after four consecutive beats would likely be severely penalized.
The stock is below its 200-day moving average with the average slope declining approximately 2.5% over the past 30 days, volume is distributing on a falling on-balance basis, and a death cross is in place — a technical configuration that suggests continued near-term weakness.
↓DeterioratingMomentum breakdown
- Expectation
- For this headwind to clear, the stock must recross above its 200-day moving average on expanding volume and sustain the breakout for at least four consecutive weeks.
CounterWith roughly 16% upside to the analyst price target and a risk/reward approaching 4-to-1 in the buyer's favor, current levels may represent an attractive entry for investors who can tolerate near-term technical weakness while waiting for fundamentals to reassert.
Per-dimension breakdown
Quality
9.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROA | 10.0 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 7.7 |
| FCF quality | 6.8 |
| Moat | 7.0 |
| Rule of 40 | 9.5 |
| Piotroski F | 10.0 |
- ▸Strong margins: 34%
- ▸Rule of 40: 71 (elite)
- ▸Strong Piotroski F-Score: 9/9
- ▸High-quality business
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 39% YoY
Momentum
1.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 3.0 |
| Volume | 0.9 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -3.6%/30d — confirmed downtrend
Sentiment
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.5 |
| Price target | 8.1 |
| erm sentiment | 5.4 |
- ▸Analyst upside: 24%
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
6.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.0 |
| quality rank | 9.1 |
| growth rank | 9.1 |
- ▸Best-in-class margins
- ▸Industry growth leader
Technical
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.1 |
| support resistance | 5.3 |
| 52w position | 2.4 |
| gap | 5.0 |
Risk (lower is worse)
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 4.3 |
| days to cover | 2.7 |
| volatility | 2.1 |
| put call | 8.6 |
| implied vol | 1.5 |
| max pain risk | 7.0 |
| beta | 5.8 |
- ▸High IV: 71%
- ▸Concentration risks: 3 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 6.7 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 2 days
How the verdict was assembled
Engine trigger
Earnings in 2 days. Wait until post-earnings.
Engine technical detail
verdict_path:
L3:NEWS_BLOCK|ENTRY_STICKY:PRIOR_STILL_VIABLEPassed (5)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (4)
- MOMENTUM:1.9<4.5
- ASYMMETRY:1.4<1.5@spot
- DEATH_CROSS:HARD_BLOCK
- EARNINGS_PROXIMITY:2d<=7d
Warning (0)
none
Reward-to-Risk
1.39
Upside
+11.6%
Downside
8.4%
Sizing output
STARTER
SetupRange Bound — RSI 43 mid-range, Bollinger mid-band
EdgeTemporary headwind — High quality (9.0) with weak momentum (1.9)
SuitabilityModerate — Balanced profile
Investment implication
A recent news event triggered an L3 news-block on the verdict path. Trigger: Earnings in 2 days. Wait until post-earnings. The 10-dimension scores remain Growth at 10.0 (strongest), but MOMENTUM:1.9<4.5 also fails — the news block is the proximate trigger, not the sole driver.
The strongest dimensions are Growth at 10.0, Quality at 9.0, and Insider at 7.3; the weakest are Momentum at 1.9, Technical at 4.5, and Risk (lower is worse) at 4.6. The V9 engine flagged 4 failed gates, producing an asymmetric reward-to-risk of 1.39 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Elite Software Quality Franchise
Trip ifGross margin compresses below 28% for 2 consecutive fiscal quarters.
- P2Hypergrowth At Discount To Growth
Trip ifRevenue growth falls below 20% year over year for 2 consecutive quarters.
- P3Consistent Earnings Execution
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P4Confirmed Price Downtrend
Trip ifPrice closes above the 200-day moving average on rising volume for 4 consecutive weeks.
- P5Customer Concentration Revenue Risk
Trip ifRevenue from top three credit bureau customers exceeds 60% of total annual revenue.