Fair Isaac

FICO prioritizes organic investment in Scores and FICO Platform, then returns excess cash via substantial, programmatic buybacks.

Repurchases were 878 million in the first nine months of FY25 with 880 million remaining under the June 2025 1.0 billion authorization as of June 30, 2025. Capex is low and R&D is focused on decisioning and platform capabilities. Leverage increased alongside buybacks, which merits prudence given policy cyclicality.

Overall, capital deployment has driven per-share value over many years. Quality Value Investing checklist quick-scores and comments (0 to 100): Wide or Narrow Moat (Morningstar-style lens): 95. De facto standard plus switching costs; regulatory acceptance; watch FHFA/GSE evolution.

High and Consistent Return on Capital: 90. Asset-light, very high segment margins and FCF conversion; negative equity distorts ROE but economic returns are strong. Revenue and FCF Growth: 85. TTM revenue 1.93 billion; TTM FCF ~748 million; multi-year growth supported by pricing and platform ARR.

High Margins: 92. Scores ~88 percent segment margin; consolidated operating leverage expanding. Owner-CEO: 80. CEO Will Lansing has a strong track record and meaningful equity exposure (1.9 percent beneficial ownership as of Nov 29, 2024). Simplicity: 85. Two segments with clear drivers; policy overlay adds some complexity.

Very Low Debt: 70. Debt increased to ~2.8 billion; covered by cash flows but leverage up. Dilution: 78. SBC present but outweighed by consistent buybacks; monitor over time. Favorable Jurisdiction: 90. U.S.-based with global reach; policy risk centered on U.S. housing finance rules.

Trend Alignment & Boringness: 88. Structural role in credit, fraud, and decisioning; platform adoption positive. Superinvestor Inspiration: 85. High-quality, cash-generative, quasi-toll business consistent with quality-compounding frameworks.

Valuation: 70. Exceptional business merits a premium, but discipline is required versus a 10-year risk-free near ~4.1 percent.