Fair Isaac Plummets 5% Despite Earnings Beat: What's Fueling the Selloff?

Summary
• FICO plunges 5% to $1,365.83 after Q3 revenue and EPS beat estimates
• 52-week range narrows to $1,354.47–$2,402.52, now near support
• Analysts cut price target to $1,953 amid mixed post-earnings sentiment
• Technicals show bearish divergence with RSI at 29.37 and MACD -73.74

Fair Isaac's stock is trading at its lowest level since early 2025 despite surpassing earnings expectations. The selloff has left the stock within 1% of its 52-week low as analysts reassess valuations. With a 20% revenue increase but mixed analyst forecasts, investors are weighing near-term momentum against long-term growth potential.

Analyst Skepticism Overshadows Earnings Optimism
Fair Isaac's 5% decline stems from diverging analyst sentiment post-earnings. While Q3 results showed 20% revenue growth and a 44% net income increase, Oppenheimer cut the price target by 15% to $1,953. The consensus target of $1,936 reflects a 7.5% drop from prior estimates, signaling caution. With a 34% profit margin and $7.49 EPS (up 46% YoY), fundamentals remain strong, but analysts' wide price target range ($1,364–$2,300) highlights valuation uncertainty. Short-term bearish technicals amplify selling pressure as the stock tests its 52-week support.

Bearish Technicals and High-Leverage Options Signal Short-Term Play
• 200-day average: $1,918.57 (far above current price)
• RSI: 29.37 (oversold territory)
• MACD: -73.74 (bearish divergence)
• Bollinger Bands: 1,351.29–1,793.92 (stock at lower band)
• 52-week low at $1,354.47 is critical support level

The technical picture is bearish with RSI in oversold territory and MACD below zero. Key resistance at $1,572.61 (middle Bollinger Band) and support at $1,351.29 (lower band) define the near-term range. The 52-week low at $1,354.47 is now a critical level—if broken, it could trigger further declines toward $1,200. The lone available options contract (FICO20261120C1440) offers 271,436% leverage but has zero turnover and delta of 0.0115. While illiquid, the high leverage makes it a speculative play if the stock continues down. For conservative traders, cash-secured puts at the $1,440 strike could capitalize on the bearish setup as the stock trades near its 52-week low.

Backtest Fair Isaac Stock Performance
After an intraday plunge of -5%, FICO has historically shown positive short-to-medium-term gains. The 3-day win rate is 55.88%, the 10-day win rate is 59.13%, and the 30-day win rate is 65.28%. While the maximum return during the backtest period was only 8.45%, the overall trend suggests that FICO tends to recover and even exceed its pre-plunge levels in the following days.

Short-Term Bear Case Strengthens: Act on Key Levels
Fair Isaac's bearish technicals and analyst caution suggest continued pressure in the near term. With RSI at 29.37 and the stock approaching its 52-week low, the path of least resistance is downward. Traders should monitor the $1,354.47 support level—breaking this could open the door to $1,200. Meanwhile, sector leader Intuit (INTU) is down 1.39%, showing the Software—Application sector isn't immune to broader market weakness. For those seeking directional exposure, the FICO20261120C1440 call option offers extreme leverage if the bearish trend continues, despite its illiquidity. Aggressive short-sellers should prioritize $1,354.47 as a critical entry trigger.