12 Stocks That Could Split in the Near Future

9. Fair Isaac Corp. (NYSE:FICO)

Share Price as of January 19: $1,900.54

Surge in Share Price in 5 Years: 369.30%

Stock Split Confirmed: No

Number of Hedge Fund Holders: 47

Fair Isaac Corp. (NYSE:FICO) is a data analytics company that focuses on credit scoring services. It is known for the FICO Score, which is a credit score widely used by lenders to assess creditworthiness. It also provides other analytics solutions for financial services, healthcare, retail, and telecommunications.

A lot of its growth comes from the Scores segment of the company, which focuses on providing credit-scoring products and services (including B2B and B2C offerings). For the full fiscal year 2024, revenues for the FICO Score segment marked a 19% increase year-over-year. B2B revenue in this segment grew 27% in FY24, primarily due to mortgage originations. This refers to creating new home loans, including the application, approval, and funding stages. However, B2C revenue declined slightly, 2% for the year, mainly due to lower sales on the myFICO.com platform.

Mortgage origination revenues rose by 95% in the last quarter of FY24. For FY25, the company’s wholesale royalty for mortgage originations will be set at $4.95 per score, which represents a small fraction of the total mortgage cost. The FICO Score remains a crucial tool in the $2 trillion mortgage origination market.

Additionally, Fair Isaac Corp. (NYSE:FICO) is seeing strong adoption of its FICO Score 10 T, which has been adopted by major lenders, including United Wholesale Mortgages. This score is now used for credit decisions, securitization, and investor delivery. It’s also set to launch the FICO Score mortgage simulator, which will allow mortgage professionals to simulate potential changes in a borrower’s credit score. This will assist in offering more loan options and better interest rates.

On January 15, Jefferies Financial Group raised the company’s price target from $2,250 to $2,275, maintaining its buy rating on the stock. This raise reflects confidence in Fair Isaac Corp.’s (NYSE:FICO) strong performance and growth prospects in the technology sector. Carillon Eagle Mid Cap Growth Fund reported strong Q3 performance for the company, driven by pricing gains in its Scores business, and anticipated growth in mortgage activity. Here’s what the firm said in its Q3 2024 investor letter:

“Fair Isaac Corporation (NYSE:FICO) provides predictive analytics and data management products and services that enable businesses to automate, improve and connect decisions. The stock performed well during the period as quarterly earnings were strong and guidance was lifted. The quarter was highlighted by continued pricing gains in the company’s Scores business. Additionally, expectations of increased residential mortgage activity as interest rates move lower also aided the stock.”