What happened
According to a filing with the U.S. Securities and Exchange Commission, published August 13, 2025, YCG, LLC, an independently registered investment adviser, bought 4,992 additional shares of Fair Isaac (FICO 0.63%) during Q2 2025.
The transaction is estimated at $9.37 million, based on the period’s average closing price. The fund’s total Fair Isaac stake reached 31,108 shares.
YCG, LLC’s Fair Isaac stake now accounts for 3.2% of its $1.29 billion in reportable assets.
What else to know
Top holdings as of June 30, 2025 are as follows:
- Microsoft: $107.99 million (8.3% of AUM) as of June 30, 2025
- Mastercard: $94.60 million (7.3% of AUM) as of June 30, 2025
- Moody's: $89.11 million (6.9% of AUM) as of June 30, 2025
- Amazon: $73.29 million (5.7% of AUM) as of June 30, 2025
- MSCI: $60.62 million (4.7% of AUM) as of June 30, 2025
Fair Isaac shares were priced at $1,419.37 as of August 27, 2025, down 17.2% over the past year, underperforming the S&P 500 by 32.4 percentage points.
From a valuation standpoint, Fair Isaac shares trade at a forward P/E (FY1 2026) of 39.9 and a trailing 12-month EV/EBITDA of 40.4. The company's five-year revenue CAGR is 8.16%.
Shares are 40.4% below their 52-week high as of August 27, 2025. The company does not pay a dividend.
Company Overview
| Metric | Value |
|---|---|
| Market Capitalization | $34.07 billion |
| Revenue (TTM) | $1.93 billion |
| Net Income (TTM) | $632.62 million |
| One-Year Price Change | -17.2% |
Company Snapshot
- Develops and sells analytic, software, and data management solutions, including the FICO Platform and business-to-business scoring products.
- Generates revenue through software, scoring solutions, and related services embedded in clients’ decision processes.
- Targets financial institutions, businesses seeking advanced analytics, and consumers via direct sales and online channels.
Fair Isaac is a leading provider of decision management software and analytics, best known for its widely used FICO credit scores and enterprise software solutions. The company leverages proprietary analytics and robust software platforms to help organizations automate and enhance critical business decisions. Its expertise in analytics reinforces its market position.
Foolish take
Fair Isaac and its FICO score has held a dominant position as the primary credit scoring algorithm since the 1990s, so when Fannie Mae and Freddie Mac announced that they will be accepting VantageScores (a joint creation of Experian, Equifax, and TransUnion), FICO investors were understandably shaken. Although the FICO score has been the gold standard in lending for literally decades and the resistance that comes with that will continue to give Fair Isaac some built-in consumer loyalty, it’s possible that some amount of its consumer base will be lost to new options in credit scoring models.
Even without a flight from FICO as a knock-on effect, pricing pressures may come into effect, pushing what Fair Isaac can charge for FICO down due to competition. However, Fair Isaac doesn’t just sell FICO scoring; it also develops other products meant to help with things like decision management, analytics, and identity and fraud detection and prevention. Expanding these areas could help Fair Isaac overcome any losses due to the adoption of VantageScores.
Even though there are still opportunities, Fair Isaac has to overcome a significant debt burden, some of which was used to buy back shares of itself, or it will be in serious trouble should VantageScores become major competition. Year to date, the stock has dropped 29%, while the S&P 500 is up 10%.
Whether this is a buying opportunity or the beginning of a slow decline will heavily depend on management chooses to address recent developments.
Glossary
13F reportable assets: Assets that institutional investment managers must disclose quarterly to the SEC if above a certain threshold.
Assets under management (AUM): The total market value of investments managed by a fund or investment firm.
Forward P/E: Price-to-earnings ratio using forecasted earnings for the next fiscal year, indicating expected valuation.
EV/EBITDA: Enterprise value divided by earnings before interest, taxes, depreciation, and amortization; measures a company's valuation relative to earnings.
CAGR: Compound annual growth rate; the mean annual growth rate of an investment over a specified period, assuming compounding.
Filing: An official document submitted to a regulatory authority, often containing financial or operational disclosures.
Stake: The ownership interest or investment held by an individual or institution in a company.
Buy and hold: An investment strategy where securities are purchased and held for a long period, regardless of market fluctuations.
Proprietary analytics: Analytical methods or models developed and owned by a company, not available to competitors.
Business-to-business (B2B): Transactions or services conducted between two businesses, rather than between a business and individual consumers.
TTM: The 12-month period ending with the most recent quarterly report.
