FICO is trading at its lowest valuation of the decade, about 13x forward earnings for what is essentially a duopoly, which is attractive. @thejmkane counters that it is no longer really a monopoly, but a duopoly at 13x is not so bad. x.com  x.com 

The shift to bi-merge credit reports may not shrink Fair Isaac's profit pool: it makes pulling both scores more economical for lenders, and credit-file gaming could shift more economics to FICO as it moves to alternative pricing. FICO can earn the same whether its score is used upfront or later in origination; what matters is how many funded loans avoid FICO entirely and what it earns on retained usage. x.com  x.com 

Fair Isaac's scoring moat is eroding after the FHFA said Fannie Mae and Freddie Mac will move to a unified mortgage pricing grid that places VantageScore alongside Classic FICO. VantageScore borrowers will reach the top pricing tier at 780+, the same threshold as FICO, eliminating their previous 20-point disadvantage. As @oguzerkan notes, even after a 60% drop this year the stock still trades at 19x earnings, a reminder never to overpay for quality. x.com  x.com  x.com  x.com 

FICO looks fairly cheap given how sticky its scores are: lenders have little reason to switch to VantageScore over something they have history with, since the score's cost is tiny relative to bad debt on a loan. A replying post counters that FICO must fight the VantageScore adoption trend after pricing-power abuse drew the administration's ire, leaving open where earnings power settles. x.com  x.com 

Fair Isaac's selloff looks technically overdone and will probably push the company to double down on buybacks, making it a short-term bounce trade. The longer-term case is less compelling. x.com  x.com  x.com 

Fair Isaac is terminally a sub-20 P/E business now that its mortgage monopoly faces a price war. Per @qualityequities, regulators cleared the cheaper VantageScore for mortgages, and the credit bureaus are aggressively discounting it to take share, undercutting the pricing power investors valued FICO for. x.com 

Fair Isaac's moat has narrowed but not disappeared, so the selloff over VantageScore may be an opportunity. FHFA Director Bill Pulte let all Fannie Mae and Freddie Mac lenders use VantageScore 4.0, ending FICO's effective mortgage monopoly, and floated a cheaper bi-merge model. That brings a lower-cost rival and threatens pricing power. But FICO is deeply embedded in lender systems, underwriting, securitizations and decades of data. It works only if valuation leaves a margin of safety. x.com 

FICO's data moat should widen against VantageScore as it leverages AI, making it an easy decision. Fair Isaac holds about 130 AI patents, per its earnings report. @VJNCapital argues the thesis rests on pricing: a few dollars for a score matter little against a $300k-$500k mortgage, and what counts is how accurately each model predicts default risk; decades of model iterations should be hard to compete against. x.com  x.com 

Fair Isaac looks more reasonable after a price reset but is now a slower compounder, still not a buy. FHFA has opened the door to VantageScore, which will chip away some share and end easy 10-15% annual price hikes, cutting earnings growth to the mid-teens from the twenties. The main concern remains management funding buybacks with debt at record multiples, reducing flexibility. If it slows the leverage, shareholders could still do fine, though more grinding than explosive. x.com 

FICO's competitive position looks safer because the GSEs' pricing grid neutralizes VantageScore's automatic pricing edge. VantageScore 4.0 has its own loan-level pricing grid that adjusts thresholds so a VantageScore is treated roughly like a Classic FICO score minus about 20 points, matching VantageScore's typical uplift. That avoids a setup that would have more heavily favored VantageScore over FICO. x.com