Is Fair Isaac (FICO) Cheap As Strong Earnings And Raised Guidance Lift The Stakes?
Why Fair Isaac’s latest earnings update matters for investors
Fair Isaac (FICO) has drawn fresh attention after reporting third quarter and year to date results on 29 July 2026, alongside higher full year guidance for revenue, net income and earnings per share.
See our latest analysis for Fair Isaac.
Fair Isaac’s recent earnings and raised guidance landed against a weak share price backdrop, with the stock down 31.66% year to date on a share price basis but still showing a 135.12% total shareholder return over five years. This points to longer term momentum despite pressure on recent share price returns.
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Fair Isaac’s earnings profile and long track record in credit scoring point to a strong business. After the share price pullback and fresh guidance, the real task now is determining whether the stock is actually priced fairly.
Most Popular Narrative: 25.7% Undervalued
The most followed narrative puts Fair Isaac’s fair value at $1,512.25, comfortably above the last close of $1,122.97. That gap sits on some punchy assumptions about growth, margins and what investors might pay for the stock in future.
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.
Want to see what is behind that confidence in Fair Isaac? The narrative leans on faster top line expansion, richer margins and a lower future earnings multiple to justify that valuation gap.
Result: Fair Value of $1,512.25 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this Fair Isaac narrative can be tested quickly if mortgage score revenues weaken further or if Direct Licensing approvals and related score programs face slower than expected uptake.
Find out about the key risks to this Fair Isaac narrative.
Another view on Fair Isaac’s valuation
The analyst narrative suggests Fair Isaac is 25.7% undervalued, yet the current P/E of 29.8x is slightly higher than both peers at 27.4x and the US Software industry at 29x. It also sits below a fair ratio of 33.1x. Is the stock cheap, or just less expensive than it could be?
For a closer look at what this earnings multiple implies for risk and upside, it helps to see how the underlying numbers stack up in a full valuation breakdown, including the fair ratio and peer context, in the See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
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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.
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