FICO is having one of its worst weeks in memory. The stock closed at $617.87 on Tuesday, down 32% for the week and 46% for the month, a collapse that has forced a rapid rethink from analysts who were still pricing the stock above $1,500 only weeks ago.
The catalyst appears to be the July 29 earnings print, where the stock fell almost 15% on the day and nearly 19% over the following five sessions. A second leg down followed at the end of July, and the stock has not recovered. The gap between where analysts thought FICO would trade and where it actually is has rarely been wider. The current mean price target is $1,256, roughly double the current price, yet that figure already reflects a series of aggressive cuts filed this week. BMO Capital lowered its target to $1,150 from $1,550 while holding its Outperform rating. Barclays cut to $935 from $1,700 and kept Overweight. Wells Fargo moved to $950 from $1,350, also maintaining Overweight. Every firm held its positive rating while cutting the price by 30% to 45%. That combination, bullish in words but brutal in numbers, says analysts believe the selloff has been overdone yet have no firm floor to stand on.
Despite the collapse in price, short positioning tells a calmer story than the price action might suggest. Short interest edged up 8% over the past week to 7.8% of free float, a meaningful level but not extreme territory. More telling is the lending market: availability is extraordinarily loose at 671%, meaning there are nearly seven shares available to borrow for every one already shorted. That level is close to the annual widest reading. Borrowing costs remain trivially low at 0.50%, up modestly on the week but down from a month ago. The short score has also fallen back, from 55.7 mid-week to 51.9 by Tuesday, its lowest level in ten days. This is not a stock being aggressively piled into by short sellers. The decline looks driven by long holders selling, not by a coordinated short attack.
Options positioning has turned notably less defensive as the week progressed. The put/call ratio closed at 0.85, below its 20-day average of 0.89 and well inside the 52-week high of 1.10. Two weeks ago, with the stock trading much higher, the PCR was running near 0.95 to 0.98. Put demand has faded even as the stock has fallen, which implies that most of the hedging activity happened earlier and options traders are not chasing additional downside protection at these levels. The PCR z-score of -0.78 confirms that current positioning is slightly more call-heavy than usual rather than defensively loaded.
The bull-bear debate on FICO centres on two things: pricing power and competitive threat. The bull case rests on the dominance of the FICO score in mortgage underwriting and consumer credit, a business where the company has historically passed through price increases with little friction, combined with a $1.5 billion buyback and strong cash generation. The bear case is anchored to the FHFA's decision that opened the door to VantageScore as an alternative in the mortgage market, a development that introduces a genuine competitor for the first time in decades. Valuation multiples have compressed sharply. The trailing PE has dropped nearly 11 points over the past 30 days to 12.3 times, and the EV/EBITDA multiple has fallen from around 12 to 9.3. At those levels FICO trades at a steep discount to its recent history for a business that still carries 22% annual revenue growth according to prior scoring data. EPS surprise ranks in the 61st percentile, suggesting the company has generally beaten estimates, though the forward earnings momentum score of 27 out of 100 shows the Street has been marking down expectations.
Retail attention has spiked sharply. The ORTEX alt data layer shows a Wikipedia-views signal running at a z-score of 2.4 against FICO's own 90-day history, placing public interest well above its recent norm. That kind of attention spike typically follows rather than precedes a large price move, and it signals the decline has broken into general financial media. The next earnings event is scheduled for November 6, 37 days away. With the stock at half its year-ago price and analysts still holding positive ratings with targets that imply 50% to 85% upside from current levels, the November print becomes a crucial test of whether the earnings trajectory justifies either the optimism or the collapse.
What to watch between now and then: whether any analysts move from Outperform to Hold as targets converge toward the current price, whether short interest continues its measured climb or reverses on any stabilisation, and whether the VantageScore adoption story produces any concrete volume data ahead of the November report.
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