Credit score software stock Fair Issac Corp (NYSE:FICO) is near the bottom of Wall Street this morning, heading for its worst single-day decline in over two years. Federal Housing Finance Agency director Bill Pulte announced changes to mortgage pricing, ending the pricing grid that features Fair Issac exclusivity. VantageScore can now compete on Fannie Mae and Freddie Mac loans.
FICO is heading for a ninth loss in the last 10 trading days, and fell to a three-year low of $656.78 out of the gate this morning. The shares are now down 61% year to date, carving a channel of lower lows since an Oct. 2 record peak of $1,998.01.
Keep an eye on bear notes that could add more pressure. Of the 20 brokerages covering Fair Issac, 13 maintain "buy" or better ratings, while the consensus 12-month price target of $1,406.52 is a 109% premium from its current perch.
Options traders are betting almost exclusively on calls. FICO's 10-day call/put volume ratio of 5.73 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits in the 100th percentile of its annual range.
