Why Did FICO Stock Rocket 16% Today?

The shares drew significant analyst interest, with Needham continuing to assign a “Buy” rating with a price target of $1,950 and Barclays raising its price target to $2,400 from $2,000.

FICO (FICO) stock has drawn significant interest from Wall Street analysts, who view its newly launched licensing program as a potential catalyst for growth. 

The company’s move to let tri‑merge credit report resellers distribute FICO Scores directly to mortgage lenders has drawn bullish commentary.

Needham continues to assign a “Buy” rating on FICO, setting a price target of $1,950, citing that the new FICO Mortgage Direct License Program can be “substantially beneficial.”  

Barclays has raised its price target to $2,400 from $2,000 and reiterated an “Overweight” rating, noting the direct licensing move as “a clear positive” that effectively doubles the mortgage pricing from $4.95 to $10 per score. 

FICO stock traded over 16% higher in Thursday’s premarket. On Stocktwits, retail sentiment around the stock jumped to ‘bullish’ from ‘bearish’ territory the previous day. Message volume improved to ‘high’ from ‘low’ levels in 24 hours. 

Since the change could reduce dependence on the three major credit agencies, shares of firms such as Equifax Inc. (EFX) and TransUnion (TRU) have come under pressure following the news, falling by over 7% and 10%, respectively, on Thursday.

FICO is rolling out two alternative fee models to power this new system. The first, called the performance model, sets a base royalty of $4.95 per score and adds a $33 fee when a mortgage funded with a FICO‑scored loan closes. The second option maintains the familiar flat $ 10-per-score rate, matching what resellers have historically paid through bureaus. 

FICO stock has declined 4% year-to-date and more than 1% over the last 12 months. 

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