Reasonable Growth, Debt Levels, and a High ROIC Make FAIR ISAAC CORP (NYSE:FICO) Appealing to Quality Investors.

Quality investors are looking for the best of the best. Companies which are growing steadily and consistently, but are also in excellent financial condition. We will have a look here to see if FAIR ISAAC CORP (NYSE:FICO) is suited for quality investing. Investors should of course do their own research, but we spotted FAIR ISAAC CORP showing up in our Caviar Cruise quality screen, so it may be worth spending some more time on it.

Some of the quality metrics of FICO highlighted

• The 5-year revenue growth of FICO has been remarkable, with 8.16% increase. This showcases the company's strong performance in driving revenue growth and indicates its competitiveness within the market.
• FICO exhibits a strong ROIC excluding cash and goodwill, indicating efficient capital utilization and profitable operations. The 144.0% reflects the company's ability to generate returns on invested capital and underscores its commitment to delivering value to shareholders.
• The Debt/Free Cash Flow Ratio of FICO stands at 3.59, reflecting the company's prudent capital structure and cash flow dynamics. This ratio highlights the company's ability to generate robust free cash flow relative to its debt obligations.
• With a favorable Profit Quality (5-year) ratio of 122.0%, FICO showcases its ability to consistently deliver high-quality profits. This metric signifies the company's financial strength and its capacity to generate sustainable earnings over an extended period.
• FICO has demonstrated consistent growth in EBIT over the past 5 years, with a strong 23.68%. This signifies the company's ability to generate sustainable earnings and reflects its positive financial trajectory.
• The EBIT 5-year growth of FICO has outpaced its Revenue 5-year growth, reflecting the company's focus on optimizing its profitability and generating sustainable earnings. This trend underscores its strong financial management.

Fundamental Analysis Observations

ChartMill employs a sophisticated system to assign a Fundamental Rating to every stock in its analysis. This rating, which ranges from 0 to 10, is determined by carefully assessing multiple fundamental indicators and properties.

Taking everything into account, FICO scores 6 out of 10 in our fundamental rating. FICO was compared to 285 industry peers in the Software industry. FICO has an excellent profitability rating, but there are some minor concerns on its financial health. FICO is valued quite expensive, but it does show an excellent growth. These ratings could make FICO a good candidate for growth investing.

For an up to date full fundamental analysis you can check the fundamental report of FICO

More ideas for quality investing can be found on ChartMill in our Caviar Cruise screen.

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.