Fair Isaac Drops on Disappointing Results

SAN FRANCISCO - Investors punished shares of Fair Isaac(FIC Quote) Tuesday after the credit-scoring software company reported results from a difficult second quarter.

Its stock was down $4.09, or 15.4%, to $22.34 in recent trading on triple its average volume.

In a note Tuesday, Wedbush Morgan analyst Michael Nemeroff advised investors to remain on the sidelines, citing continued weakness in financial services, potential problems while the company restructures, and pricing pressure in Fair Isaac's high-margin scoring business from VantageScore, a competing product offered by the three largest U.S. credit bureaus. The firm makes a market in shares of FIC.

The company's guidance for full-year revenue of $763.3 million and EPS of $1.51 is well below the consensus estimate, Nemeroff noted. Analysts were projecting a top line of $829.5 million and EPS of $1.83. Fair Isaac's second-half revenue projections exclude discontinued operations of four business lines the company hopes to sell in the coming months. ...