Fair Isaac, Auto Lenders Outpace Market Decline

Collection industry related stocks fell sharply through mid-day Tuesday, getting pulled down by weakness in the overall market and continued concern regarding credit market weakness and loan defaults.

The Dow Jones Industrial Average this morning fell more than 190 points, or 1.5 percent, to just over 12,587, marking a total drop of about 1,500 points since the October highs.

One of the hardest hit stocks at mid-day was Fair, Isaac (NYSE: FIC), which fell nearly 5 points, or 17 percent, to $23.47. In addition to macroeconomic factors, the weakness in Fair, Isaac was due to poor financial results the provider of credit analysis systems released after Monday’s market close.

Fair, Isaac announced it expects to report first quarter revenues in the range of $198 to $200 million in the first quarter of fiscal 2008 versus $208.2 million reported in the prior year period. This is lower than the first quarter revenue guidance of $205 million provided by the company last quarter. Net income for the first quarter of fiscal 2008 is expected to total in the range of $19 million to $21 million, or $0.37 to $0.39 per diluted share, versus $31.2 million, or $0.52 per diluted share, reported in the prior year period. This is lower than the first quarter GAAP earnings per diluted share guidance of $0.45 provided last quarter.

Total revenues are expected to be $205 million for the second quarter of fiscal 2008 with GAAP earnings of approximately $0.44 per share. Full year fiscal 2008 revenue is now expected to be $825 to $835 million with GAAP earnings per diluted share of $1.80 to $1.90. Previous guidance for full year fiscal 2008 was $850 million in revenue and GAAP earnings per diluted share of $2.

Following Fair, Isaac in the market downdraft was auto lender AmeriCredit Corp. (NYSE: ACF), down nearly $1, or 8 percent, to just over $11. AmeriCredit was hurt by a Friedman Billings Ramsey downgrade as well as the overall macroeconomic conditions.

Auto lender Consumer Portfolio Services (Nasdaq: CPSS) was off as well, dropping more than 6 percent to $2.78.