Which Gives You More Of Hard-To-Replace Software, PTC Or Fair Isaac?
PTC (PTC) and Fair Isaac are both owned for software that customers find hard to replace. PTC sells more to manufacturers it already serves, while Fair Isaac has raised the price of its mortgage credit score. Fair Isaac stock has lost 46% in a month, while PTC stock has lost 12.5%. Which of the two is gaining the firmer grip on its customers?
PTC Is Selling More, Fair Isaac Is Charging More
PTC’s latest report pointed to its grip widening, while Fair Isaac’s score sales to businesses grew mostly on price. Annual recurring revenue is the yearly value of PTC’s subscriptions. On its fiscal Q3 2026 call, PTC forecast about 9% to 9.5% growth in that revenue for fiscal 2026. That forecast is at constant currency and excludes businesses PTC sold. Management also said the value of business PTC won from rivals had doubled in a year.
In September 2026, defense manufacturer Fisica Applied Technologies standardized on PTC’s Creo CAD and Windchill PLM. Those are PTC’s design and product data software.
Fair Isaac raised its fiscal 2026 revenue forecast to $2.53 billion, up 20% from the prior year. Management said Fair Isaac’s score sales to businesses grew mainly on a higher mortgage score price. Fair Isaac’s mortgage score volumes grew only in the low single digits.
On September 29, 2026, the Federal Housing Finance Agency announced a change to mortgage pricing. Under the change, VantageScore, a cheaper rival, would join Fair Isaac’s Classic FICO score in the framework used to price mortgages. PTC’s recent gains come from customers choosing it. Fair Isaac’s gains in score sales came mostly from price. Fair Isaac must now defend its higher price against that cheaper rival.
Fair Isaac Borrowed To Buy Back Stock
Fair Isaac paid for its latest buyback partly with borrowed money. It spent $1.96 billion on its own shares in fiscal Q3 2026. Fair Isaac took out a $1.5 billion term loan in June to fund part of that.
Fair Isaac ended that quarter with $5.58 billion of debt. That is about seven times its net income of $0.8 billion over the past twelve months. Management said Fair Isaac will use cash to pay down debt in the near term.
PTC also expects to buy back stock in fiscal 2026. PTC’s debt, though, equals 10.2% of its market value, against 40% for Fair Isaac. PTC leads Fair Isaac on debt, and the two companies also part ways on valuation, growth and margins.
Where Else Does Each Company Come Out Ahead?
Fair Isaac comes out ahead on recent and three-year revenue growth and on operating margin. PTC comes out ahead on valuation and net margin. Fair Isaac’s revenue grew 24% over the past twelve months, against 19.5% for PTC. Operating margin is the share of sales a company keeps from running its business. Fair Isaac’s is 52%, against 38% for PTC.
PTC stock costs 12.9 times its past year’s earnings, against 17.2 times for Fair Isaac. So you pay less for each dollar of PTC’s profit. PTC also keeps 41% of its sales as net profit, against 34% for Fair Isaac. That PTC figure is above PTC’s operating margin, so part of PTC’s profit came from outside its day-to-day business. That extra profit also flatters PTC’s lower earnings multiple.
The evidence splits evenly between PTC and Fair Isaac. PTC suits a holder who wants a lower earnings multiple with lighter debt. Fair Isaac suits one who wants faster growth and a higher operating margin. That holder must accept Fair Isaac’s heavier debt and a cheaper rival score.
You should watch Fair Isaac’s mortgage score revenue in its next quarterly reports. If that revenue keeps growing, Fair Isaac’s faster growth counts for more. If that revenue shrinks instead, PTC’s lower earnings multiple and lighter debt count for more.
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