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Fair Isaac (FICO) is drawing investor attention after recent share price weakness, with the stock showing negative returns over the past month and past 3 months, and a 1 year total return decline alongside strong multi year gains.
See our latest analysis for Fair Isaac.
That recent stretch of share price weakness, including a 30 day share price return of 13.45% decline and a 1 year total shareholder return of 21.90% decline, contrasts with much stronger total shareholder returns over the past three and five years. This suggests momentum has cooled after a strong multi year run.
If FICO’s pullback has you rethinking where to put fresh cash to work, it could be a good moment to look at high growth tech and AI stocks as potential alternatives in similar themes.
So with Fair Isaac’s shares giving up recent gains despite multi year strength and the stock trading below some analyst targets but close to some intrinsic estimates, is this a genuine reset that opens a buying window, or is future growth already priced in?
Fair Isaac’s most followed narrative puts fair value at about $2,023 per share, well above the recent $1,463 close, which is why many investors are paying attention to the story behind that gap.
The ongoing transition to SaaS and cloud-based delivery, evidenced by double-digit growth in FICO Platform ARR and emphasis on conversion to next-generation AI-driven decisioning solutions, is increasing recurring revenues, supporting margin expansion and greater earnings predictability.
Curious what kind of revenue trajectory and margin profile need to line up for that valuation to make sense, especially with a higher discount rate baked in and earnings power assumptions stretching several years out? The narrative spells out the growth, profitability and valuation multiple it assumes Fair Isaac can sustain.
Result: Fair Value of $2,023.18 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, the narrative also hinges on mortgage related rule changes and rising competition, as shifts in lender preference or regulation could challenge FICO’s core scoring business.
Find out about the key risks to this Fair Isaac narrative.
Those narrative driven fair value estimates around $2,023 sit awkwardly beside where the market is currently pricing Fair Isaac today. On a P/E of 52.8x, the shares trade well above the US Software average of 28.8x and peers at 40.7x, and even above a fair ratio of 38.4x that the market could move toward over time. That kind of gap can mean extra downside risk if sentiment cools, so the real question is which story you think the market eventually leans into.
See what the numbers say about this price — find out in our valuation breakdown.
NYSE:FICO P/E Ratio as at Jan 2026
If you look at this and think the assumptions do not quite fit your view, you can pull up the same data, stress test your own inputs and build a fresh story around Fair Isaac in just a few minutes with Do it your way.
A great starting point for your Fair Isaac research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
If FICO is only one piece of your watchlist, do not stop here, you could miss other opportunities that better fit your style and risk tolerance.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include FICO.
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