/Tyler%20Technologies%2C%20Inc_%20logo%20on%20laptop-by%20monticello%20via%20Shutterstock.jpg)
The Plano, Texas-based company, Tyler Technologies, Inc. (TYL) provides integrated information management solutions and services for the public sector. Valued at a market cap of nearly $25 billion, the company has pioneered computer-assisted mass appraisal (CAMA) and developed integrated software solutions for tax billing and collections. It is expected to announce its fiscal Q3 earnings results after the market closes on Wednesday, Oct. 23.
Ahead of this event, analysts project the public sector software company to report a profit of $1.87 per share, up nearly 12.7% from $1.66 per share in the year-ago quarter. The company has consistently beaten Wall Street's earnings estimates in the last four quarters. Its adjusted earnings for the last quarter outpaced the consensus estimates by 2.6%.
For fiscal 2024, analysts expect TYL to report an EPS of $7.21, up 24.3% from $5.80 in fiscal 2023. Moreover, EPS is expected to increase 16.5% year-over-year to $8.40 in fiscal 2025.
Shares of TYL have surged 40.7% on a YTD basis, outperforming both the S&P 500 Index's ($SPX) nearly 23% rise and the Technology Select Sector SPDR Fund’s (XLK) 20% return over the same period.
TYL’s strong performance can be attributed to its steady flow of contracts from the government, healthcare, and education end markets due to the public sector's increasing reliance on technology to improve efficiency and service delivery. Its specialization in providing technology solutions exclusively for the public sector has also benefited the company by giving it a competitive edge over others.
Moreover, shares of TYL surged 9.4% after its Q2 earnings release on Jul. 24, as its adjusted earnings climbed 19.4% year-over-year to $2.40 per share and surpassed the consensus estimates of $2.34. The company’s revenue of $541 million also surpassed Wall Street’s forecasts of $537.3 million and increased 7.3% from a year ago. The better-than-expected performance was primarily driven by a rise in subscription and professional services revenues, offsetting a slight fall in maintenance revenues. TYL’s 150 bps expansion in non-GAAP operating margin to 24.5% might have further contributed to its upward price movement.
Analysts' consensus view on Tyler Technologies’ stock is optimistic, with a "Strong Buy" rating overall. Among 14 analysts covering the stock, 14 recommend a "Strong Buy," one suggests a "Moderate Buy," and two indicate “Hold.” This configuration is slightly more bullish than three months ago, with 13 analysts suggesting a "Strong Buy."
The average analyst price target for TYL is $605.71, indicating a nearly 2.7% potential upside from the current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
