Fair Isaac: Watching The Moat While The Market Revalues Risk

Regulatory pressures and replacement risk, not fundamentals, are driving FICO's valuation compression despite continued robust financial performance and strong margins. FICO's core business shows no immediate signs of volume loss or pricing pressure, but regulatory threats and AI-driven competition cloud its long-term outlook. Valuation remains elevated versus historical averages, and a realistic bear case could see significant downside if regulatory and competitive threats materialize.