Fair Isaac stock rebounds 11% after mortgage-scoring rout as BofA cuts target

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Fair Isaac Corp. stock rose 11% on Thursday, two days after the federal housing finance agency introduced competition to FICO Score's longstanding advantage in the nation's mortgage market. FICO stock had fallen by more than 20% on Tuesday, driven by mortgage-scoring policy changes that place VantageScore and FICO on the same mortgage pricing grid, potentially pressuring FICO's pricing power in mortgages backed by Fannie Mae and Freddie Mac. FHFA director Bill Pulte described the move in an X post as a way to simplify mortgage pricing, adding that he had spoken with Fair Isaac CEO Will Lansing and reiterated that FICO Scores are approved on our end, and that the agency does not care who wins but wants FICO and Vantage to compete rather than be a cartel or abusive monopolies. The stock bounced back on Thursday despite a downgrade from Bank of America analysts, who halved FICO's price target to $700 from $1,400 and downgraded it to Neutral from Buy, writing that the revised grid adds another risk to score volumes, pricing, and market share.

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Financials▲ · 4 stocks
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Fair Isaac Corporation
FICO
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FHFA placed VantageScore and FICO on the same mortgage pricing grid, introducing competition that could pressure FICO's pricing power and market share in mortgage scoring.

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