How Risky Is Fair Isaac Stock

Fair Isaac (FICO) stock has lost 51.8% over the past year, while the S&P 500 returned 17.4%. Its largest one-day fall of that year came on September 29, 2026. Shares dropped 27% after the director of the Federal Housing Finance Agency said the mortgage pricing grid used by Fannie Mae and Freddie Mac is being simplified to incorporate rival VantageScore on equal terms with FICO. If the whole market turns now, how far has Fair Isaac fallen in past shocks, and how long did it stay down?

How Fair Isaac Stock Has Fared In Market Shocks

Fair Isaac stock has fallen further than the market during most past shocks, though it dropped less than the S&P 500 in each of the five since 2022. Across every market shock since 2007, the shares fell 19.0% on average, against 15.8% for the S&P 500.

The deepest of those falls happened in the 2008-2009 financial crisis. The stock lost 70%, against 53% for the index. In the 2020 COVID-19 crash, Fair Isaac fell 51%, while the S&P 500 fell 34%.

Of the 13 falls it fully made back, the stock took a median of 3.0 months to return from the low to its earlier peak. After the 2008-2009 crisis, though, the wait extended to 32.0 months. One fall has not been made back at all. Fair Isaac's latest close is 64.6% below its peak close in the 2025 tariff shock.

Fair Isaac Today: Faster Growth, Wider Margins, More Debt

Fair Isaac's business is growing faster than it did in recent years. Revenue reached $2.39 billion over the four quarters ended June 30, 2026, up 24.1% from a year earlier. Growth was 16.7% in the twelve months before that, and 12.3% the year before.

The 52.1% operating margin over those twelve months is the highest at any of the 40 quarter ends from fiscal Q4 2016 to fiscal Q3 2026. Scores, the credit score business, is expanding much faster than Software. In fiscal 2025, Scores revenue grew 27.1%, against 3.1% for Software.

Fair Isaac also owes far more. Debt totaled $5.6 billion at June 30, 2026, against $2.8 billion a year earlier. Management said on the July 29 call that the company took out a $1.5 billion term loan in June to fund an accelerated share repurchase.

Where Fair Isaac's Mortgage Business Is Under Pressure

Scores sold to mortgage lenders made up 62% of Scores revenue in fiscal Q3 2026, management said on that call. The rise in business-to-business revenue came mainly from a higher price per mortgage origination score, management said, while volumes grew only by a low single digit.

VantageScore's gains in the mortgage bond market also came up on the July 29 call. Management said it was not seeing volume loss, but admitted that is not easy to monitor. It added that elevated interest rates and affordability challenges keep mortgage originations below historical norms.

The FICO Mortgage Direct Licensing Program, which management called a strategic priority, was not yet live at the time of the July 29 call. Management said then that it was still waiting on certification from one of the GSEs.

Mortgage origination revenue, up 97% from a year earlier in fiscal Q3 2026, is the figure to watch in the report expected on or around November 3, 2026.

Does This Mean You Should Act On FICO?

Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.

There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.

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