One of the more difficult tasks associated with corporate management is the evaluation of business risks. When firms decide to seek a little help along that line, there is an outfit in Minneapolis that gets a lot of calls.

Fair Isaac Corporation (NYSE: FIC) provides statistics-based predictive tools and services for the consumer credit and general financial industries. Leading products include decision management programs for marketing, account origination, customer management, fraud, collections, mortgage lending, and review of medical bills. The firm also develops FICO scores that are used to evaluate credit applicants and offers a variety of business strategy consultation services. Fair Isaac serves banks, credit reporting businesses, credit card processing concerns, insurers, retailers, healthcare companies and government agencies. Clients include American International Group (NYSE: AIG), Procter & Gamble (NYSE: PG) and Pfizer (NYSE: PFE).

The firm surprised the Street last week, when it announced fiscal Q4 EPS of 49 cents and revenues of $207.2 million. Analysts had been expecting 41 cents and $201 million. Management also guided Q1 EPS to 45 cents (44 cent consensus), Q1 revenues to $205.0 million ($203.16M consensus), FY08 EPS to $2.00 ($1.91 consensus) and FY08 revenues to $850 million ($839.16M consensus). The news popped FIC shares into a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with four "strong buys" and eight "holds". The FIC P/E ratio (20.53), Price to Sales ratio (2.52), Price to Book ratio (3.66), Price to Cash Flow ratio (13.37), Price to Free Cash Flow ratio (13.53), Net Profit Margin (12.73%), Return on Assets (8.06%) and Return on Investment (13.64%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $33.72 and $42.97. A stop-loss of $32.75 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.