Founded in 1956, Fair Isaac Corp (FICO, Financial) is a leading software company that specializes in analytics software and tools used across multiple industries to manage risk, fight fraud, build more profitable customer relationships, and optimize operations. As of August 3, 2023, the company's stock price stands at $860.13, with a market cap of $21.5 billion. The stock has seen a gain of 4.61% today and an 8.00% increase over the past four weeks. In this article, we will delve into the company's GF Score of 81/100, indicating good outperformance potential, and its implications for potential investors.
Financial Strength Analysis
FICO's Financial Strength Rank is 4/10, which is a measure of the company's financial situation. The company's interest coverage is 6.64, indicating its ability to cover its interest expenses on outstanding debt. Its debt to revenue ratio is 1.39, suggesting a moderate level of debt relative to its revenue. The company's Altman Z-Score is 10.70, indicating a low probability of bankruptcy.
Profitability Rank Analysis
The company's Profitability Rank is 9/10, reflecting its high profitability. FICO's Operating Margin is 40.27%, indicating a high level of operational efficiency. Its Piotroski F-Score is 6, suggesting a stable financial situation. The company has shown consistent profitability over the past 10 years, with a 5-year average operating margin trend of 16.50%.
Growth Rank Analysis
FICO's Growth Rank is 10/10, indicating strong growth in terms of revenue and profitability. The company's 5-year revenue growth rate is 12.40%, and its 3-year revenue growth rate is 10.90%. Its 5-year EBITDA growth rate is 28.50%, suggesting a robust growth in its business operations.
GF Value Rank Analysis
The company's GF Value Rank is 1/10, indicating that the stock is currently overvalued. This rank is determined by the price-to-GF-Value ratio, a proprietary metric calculated based on historical multiples and an adjustment factor based on a company's past returns and growth.
Momentum Rank Analysis
FICO's Momentum Rank is 6/10, reflecting a moderate level of momentum in its stock price. This rank is determined using the standardized momentum ratio and other momentum indicators.
Competitor Analysis
When compared to its main competitors in the software industry, FICO holds a competitive position. Paycom Software Inc (PAYC, Financial) has a GF Score of 97, Zoom Video Communications Inc (ZM, Financial) has a GF Score of 73, and PTC Inc (PTC, Financial) has a GF Score of 85.
Conclusion
In conclusion, FICO's overall GF Score of 81/100 suggests good outperformance potential. The company's strong profitability and growth ranks, coupled with its moderate financial strength and momentum ranks, make it an attractive investment option. However, its low GF Value Rank indicates that the stock is currently overvalued. Therefore, potential investors should carefully consider these factors before making an investment decision.
