Fair Isaac Corp. (NYSE:FICO)

The analysis of the financial data reveals significant positive trends in key performance indicators over the period from 2019 to 2024.

Net Operating Profit After Taxes (NOPAT)

NOPAT demonstrates a consistent and substantial upward trend throughout the periods, increasing from 238,184 thousand US dollars in 2019 to 589,082 thousand US dollars in 2024. This represents a strong growth trajectory, with notable acceleration especially after 2020, indicating enhanced operational profitability over time.

Cost of Capital

The cost of capital shows minor fluctuations but remains relatively stable between 15.58% and 16.96%. It experienced a slight increase, particularly in the later years, moving from 16.25% in 2019 to 16.96% in 2024. This suggests marginally higher financing costs or required returns by investors over the period.

Invested Capital

Invested capital experiences a mild decrease from 1,401,400 thousand US dollars in 2019 to a low of 1,329,445 thousand US dollars in 2022, followed by a gradual recovery to 1,416,757 thousand US dollars in 2024. This pattern indicates some strategic adjustments or efficiency improvements in capital allocation during the middle years, before stabilizing towards the end of the timeframe.

Economic Profit

Economic profit exhibits an impressive increase, rising sharply from 10,479 thousand US dollars in 2019 to 348,850 thousand US dollars in 2024. This growth, reflecting the surplus value generated beyond the cost of capital, aligns with the increases in NOPAT and suggests enhanced value creation for shareholders and stakeholders alike.

Overall, the data indicate strong operational performance improvement, with profitability and value creation significantly outpacing the relatively stable invested capital base and slightly rising cost of capital. This suggests effective management in leveraging investments to generate increasing returns.

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

The economic profit demonstrates a clear upward trend from 2019 through 2024. It increased significantly from 10,479 thousand US dollars in 2019 to 40,159 thousand in 2020, showing nearly a fourfold growth. This growth accelerated in subsequent years, reaching 191,199 thousand in 2021 and continuing to rise to 238,638 thousand and 249,336 thousand in 2022 and 2023, respectively. The highest value was recorded in 2024 at 348,850 thousand, indicating robust profitability improvements over the six-year period.

Invested Capital

The invested capital exhibits a generally stable pattern with minor fluctuations. It started at 1,401,400 thousand US dollars in 2019, increased slightly to 1,445,030 thousand in 2020, then declined to 1,370,014 thousand in 2021 and further to 1,329,445 thousand in 2022. A moderate recovery occurred in 2023 and 2024, with invested capital reaching 1,372,115 thousand and 1,416,757 thousand, respectively. These variations suggest careful management of capital investments with no drastic changes over the observed period.

Economic Spread Ratio

The economic spread ratio showed a notable upward progression, indicating increased efficiency in generating returns on invested capital. Starting at a low 0.75% in 2019, it improved markedly to 2.78% in 2020 and surged to 13.96% in 2021. This positive momentum continued, with the ratio reaching 17.95% in 2022 and slightly increasing to 18.17% in 2023. The ratio peaked at 24.62% in 2024, reflecting significant enhancement in economic value creation over the timeframe analyzed.

Economic Profit

There is a clear upward trend in economic profit over the six-year period. It grew significantly from $10,479 thousand in 2019 to $348,850 thousand in 2024. Notably, the most substantial increases occurred between 2020 and 2021, where economic profit rose by approximately 4.75 times, and between 2023 and 2024, showing a considerable acceleration in value.

Adjusted Revenues

Adjusted revenues also showed consistent growth throughout the analyzed years. Starting at $1,168,285 thousand in 2019, revenues increased steadily each year to reach $1,734,500 thousand in 2024. The growth pattern indicates sustained revenue expansion, with no year showing a decline or stagnation.

Economic Profit Margin

The economic profit margin experienced significant growth as well. From a modest 0.9% in 2019, it rose steadily to 20.11% by 2024. This indicates an improvement in the company’s ability to generate economic profit relative to its adjusted revenues. Despite a minor decline from 17.13% in 2022 to 16.29% in 2023, the margin rebounded strongly in 2024 to its highest level in the period analyzed.

Overall Observations

The company exhibited strong financial performance improvements over the years under review. Growth in both adjusted revenues and economic profit suggest effective business expansion and operational efficiency. Elevated economic profit margins reinforce this view, indicating improved profitability relative to revenue size. The data implies positive management strategies contributing to increasing economic value.