Reliance on banks adds risk

Article Excerpt

FAIR ISAAC CORP. $81.96 (New York symbol FICO; TSINetwork Rating: Average) (415-472-2211; www.fairisaac.com; Shares outstanding: 31.4 million; Market cap: $2.6 billion; Dividend yield: 0.1%) makes FICO Scores, a computer program that helps businesses make better decisions about customer creditworthiness. Fair Isaac also sells software that helps credit card issuers control fraud and analyze cardholders’ spending patterns. In its fiscal 2015 first quarter, which ended December 31, 2014, Fair Isaac’s revenue rose 2.8%, to $189.6 million from $184.3 million a year earlier. Earnings per share fell 6.8%, to $0.68 from $0.73. Fair Isaac spent more on research and marketing, and that hurt profits. The company expects to earn $2.78 to $2.88 a share for all of fiscal 2015, and it trades at a high 28.9 times the midpoint of that range. As well, the banking industry supplies 75% of Fair Isaac’s revenue, and the likelihood of rising interest rates later this year could slow mortgage demand and hurt sales of its…