Fair Isaac Corp. (NYSE:FICO)

The data indicates a positive trend in several key financial metrics over the six-year period ending in 2024.

Net Operating Profit After Taxes (NOPAT)

NOPAT has consistently increased year over year, starting at 238,184 thousand USD in 2019 and reaching 589,082 thousand USD in 2024. This suggests improved operational efficiency and profitability.

Cost of Capital

The cost of capital shows minor fluctuations, ranging from 15.74% to 17.14%. It slightly decreased between 2020 and 2022 but rose again in 2023 and 2024. Despite these movements, the cost of capital remains relatively stable within this narrow band.

Invested Capital

Invested capital has experienced moderate changes, decreasing from approximately 1,401,400 thousand USD in 2019 to a low of 1,329,445 thousand USD in 2022, before increasing again to 1,416,757 thousand USD in 2024. The fluctuations in invested capital appear to be relatively small, suggesting consistent levels of investment in business assets.

Economic Profit

Economic profit demonstrates a strong upward trajectory, growing from 8,083 thousand USD in 2019 to 346,296 thousand USD in 2024. This significant increase indicates improved value creation beyond the cost of capital, especially notable from 2020 onwards where economic profit rose rapidly.

Overall, the financial indicators reveal that the company has improved its profitability and value creation performance over the years. NOPAT growth outpaces relatively stable invested capital levels, contributing to substantial gains in economic profit despite slight variations in the cost of capital.

Net Income

The net income exhibits a consistent upward trend over the six-year period. Starting at 192,124 thousand USD in September 2019, it increased to 236,411 thousand USD in 2020 and then surged to 392,084 thousand USD in 2021. Although a slight decline occurred in 2022 to 373,541 thousand USD, the net income rebounded in the following years, reaching 429,375 thousand USD in 2023 and further rising to 512,811 thousand USD in 2024. Overall, net income more than doubled from 2019 to 2024, indicating strong profitability growth with only a minor setback in 2022.

Net Operating Profit After Taxes (NOPAT)

NOPAT shows a robust increasing pattern throughout the same timeframe. Starting at 238,184 thousand USD in 2019, it steadily rose each year, reaching 279,157 thousand USD in 2020, and notably increasing to 407,349 thousand USD in 2021. The upward trajectory continued in 2022 with 445,701 thousand USD, followed by further growth to 476,369 thousand USD in 2023, and culminating at 589,082 thousand USD in 2024. The consistent annual growth in NOPAT reflects improved operating efficiency and profitability after tax considerations.

Trend Analysis

Both net income and NOPAT demonstrate strong expanding trends, suggesting effective operational management and increasing earnings capacity over the years analyzed. While net income experienced a minor dip in 2022, it recovered promptly in subsequent years, maintaining an upward direction. The continuous growth in NOPAT supports the view of enhanced operational success independent of non-operating influences. The increase in these profitability measures indicates sustained financial strength and improved returns from core business activities.

Provision for Income Taxes

The provision for income taxes exhibits a general upward trend over the analyzed periods. Starting at $23,948 thousand in September 2019, it decreased slightly in 2020 to $20,589 thousand but then rose significantly to $81,058 thousand in 2021. This upward momentum continued with increases to $97,768 thousand in 2022, $124,249 thousand in 2023, and $129,214 thousand in 2024. The data suggests heightened tax liabilities, particularly from 2021 onward, indicating either increased profitability or changes in tax rates or accounting practices.

Cash Operating Taxes

Cash operating taxes show a more volatile pattern compared to the provision for income taxes. Starting at $25,518 thousand in 2019, there is a noticeable increase to $38,863 thousand in 2020. A substantial jump occurred in 2021 to $96,011 thousand, followed by a further increase to $104,928 thousand in 2022. The highest cash operating taxes were recorded in 2023 at $192,079 thousand, nearly doubling the previous year. However, in 2024, a decline to $179,179 thousand is observed. This volatility might reflect timing differences in tax payments, changes in taxable income, or cash flow management strategies related to tax obligations.

Comparative Insights

While both provisions and cash operating taxes generally trend upward, the cash taxes demonstrate more pronounced fluctuations with a peak in 2023 followed by a reduction in 2024. The provision for income taxes increases steadily, which may imply growing profitability or an accounting recognition of tax expenses more consistently aligned with earnings. The disparity between the two measures could indicate temporary differences in tax expense recognition and actual tax payments over the periods analyzed.

Total Reported Debt & Leases

The total reported debt and leases have shown a consistent upward trend over the six-year period. Starting at approximately 928 million USD in 2019, the value increased steadily each year, with a notable acceleration between 2020 and 2022. By 2024, the debt and lease obligations reached roughly 2.25 billion USD, more than doubling the initial amount. This indicates an increasing reliance on debt financing or lease commitments.

Stockholders’ Equity (Deficit)

Stockholders’ equity experienced significant fluctuations over the period. Initially positive, it grew from about 290 million USD in 2019 to 331 million USD in 2020. However, from 2021 onward, equity turned negative and continued to deteriorate, reaching a deficit of nearly 963 million USD in 2024. The negative equity values suggest sustained losses or significant reductions in net assets during these years.

Invested Capital

Invested capital exhibited moderate variability but remained relatively stable compared to the other metrics. Starting at approximately 1.4 billion USD in 2019, it experienced a slight decline in the following years, bottoming out near 1.33 billion USD by 2022. Subsequently, invested capital showed a gradual increase, ending at about 1.42 billion USD in 2024. This relative stability indicates that the underlying capital investment base has not changed dramatically despite fluctuations in debt and equity.

Economic profit

Economic profit shows a significant upward trend over the analyzed period. Starting from 8,083 thousand US dollars in 2019, it rises sharply to 37,628 thousand in 2020, and then experiences substantial increases in subsequent years, reaching 346,296 thousand in 2024. This indicates a strong improvement in the company's profitability beyond its cost of capital.

Invested capital

The invested capital demonstrates a relatively stable pattern with slight fluctuations. It starts at 1,401,400 thousand US dollars in 2019, rises slightly to 1,445,030 thousand in 2020, then declines gradually over the next two years to 1,329,445 thousand in 2022. Following this, there is a moderate increase to 1,416,757 thousand in 2024. Overall, the capital base remains quite steady with minor decreases and recoveries throughout the period.

Economic spread ratio

The economic spread ratio exhibits a marked improvement from 0.58% in 2019 to 24.44% in 2024. This ratio indicates the return on invested capital over the cost of capital, reflecting enhanced value creation. The increase is especially notable between 2020 and 2024, where the ratio jumps from 2.6% to over 24%, suggesting substantial gains in operational efficiency or profitability relative to the investment.

Summary of financial trends

There is a clear and consistent upward trajectory in economic profit and economic spread ratio, suggesting enhanced financial performance and superior value creation over the years reviewed. The relatively stable invested capital implies that the improvements in economic profit and spread are likely driven by better utilization of existing capital rather than large increases in invested assets. These trends collectively point to effective management decisions contributing to increased economic value and profitability.

The financial data indicates a consistent upward trend across all key performance metrics over the six-year period ending September 30, 2024. Notably, economic profit has shown substantial growth, increasing from 8,083 thousand US dollars in 2019 to 346,296 thousand US dollars in 2024. This represents a significant enhancement in profitability, with the company displaying robust capacity to generate profits beyond the cost of capital.

Economic Profit

The economic profit increased markedly from 2019 to 2024, with the most pronounced growth occurring between 2020 and 2021, where the value rose approximately fivefold. Although growth continued after this period, the increments were more moderate but steady. The rising economic profit suggests improving operational efficiency and effective capital management over time.

Adjusted Revenues

Adjusted revenues also demonstrated a positive trajectory, moving from approximately 1.17 billion US dollars in 2019 to 1.73 billion US dollars in 2024. This growth, while more gradual than economic profit, indicates an expanding top line and potential market strength or successful business strategies that drive sales growth. The steady rise in revenue serves as a solid foundation for the increasing economic profit observed.

Economic Profit Margin

The economic profit margin evolved significantly, rising from a low level of 0.69% in 2019 to nearly 20% in 2024. This indicates a rising proportion of economic profit relative to adjusted revenues, reflecting enhanced profitability and possibly improved cost structures or pricing power. The margin’s sharp increase between 2019 and 2021 highlights a critical period in which the company improved its economic efficiency markedly.

Overall, the financial data reflects strong improvements in profitability and revenue growth, with economic profit and its margin outpacing revenue increases. This trend suggests that the organization has been increasingly successful in converting revenues into substantial economic value, signaling strong management effectiveness and potentially favorable market conditions during the analyzed period.