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Tyler Technologies (TYL)
NYSE:TYL
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Tyler Technologies
(NYSE:TYL)
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Rating:66Neutral
Price Target:
$516.00
▲(13.81% Upside)
Tyler Technologies' overall stock score is driven by its strong financial performance and positive earnings call, which highlight robust revenue growth and strategic initiatives. However, technical analysis indicates bearish momentum, and the high P/E ratio suggests potential overvaluation. The decline in free cash flow growth and challenges highlighted in the earnings call also contribute to a more cautious outlook.
Positive Factors
Revenue Growth
The consistent revenue growth reflects Tyler's expanding market presence and strong demand for its software solutions, supporting long-term business stability.
SaaS Growth
The robust growth in SaaS revenues indicates successful cloud transition and recurring revenue model, enhancing Tyler's competitive edge and future profitability.
Successful Acquisitions
Strategic acquisitions bolster Tyler's product offerings and market reach, driving long-term growth and strengthening its position in the public sector software market.
Negative Factors
Decline in New SaaS ARR
The decline in new SaaS ARR could signal challenges in maintaining growth momentum, potentially impacting future revenue streams and market competitiveness.
Impact of Texas Payments Contract Wind Down
The reduction in revenues from the Texas payments contract may affect overall revenue growth and necessitate finding new revenue sources to offset the decline.
Cash Flow Decline
A decline in cash flow could hinder Tyler's ability to invest in growth opportunities and manage financial obligations, affecting long-term financial health.
Tyler Technologies (TYL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$19.51B
Dividend YieldN/A
Average Volume (3M)336.44K
Price to Earnings (P/E)63.1
Beta (1Y)0.58
Revenue Growth10.62%
EPS Growth31.43%
CountryUS
Employees7,462
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)2.97
Shares Outstanding43,027,730
10 Day Avg. Volume240,975
30 Day Avg. Volume336,440
Financial Highlights & Ratios
PEG Ratio1.66
Price to Book (P/B)7.25
Price to Sales (P/S)11.49
P/FCF Ratio40.67
Enterprise Value/Market Cap1.16
Enterprise Value/Revenue9.84
Enterprise Value/Gross Profit22.25
Enterprise Value/Ebitda42.90
Forecast
1Y Price Target
$624.85Price Target Upside37.81% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
EPS Forecast (FY)12.52
Revenue Forecast (FY)$2.55B
Tyler Technologies Business Overview & Revenue Model
Company DescriptionTyler Technologies, Inc. provides integrated information management solutions and services for the public sector. The company operates in three segments: Enterprise Software; Appraisal and Tax; and NIC. It offers financial management solutions, including modular fund accounting systems for government agencies or not-for-profit entities; utility billing systems for the billing and collection of metered and non-metered services; products to automate city and county functions, such as municipal courts, parking tickets, equipment and project costing, animal and business licenses, permits and inspections, code enforcement, citizen complaint tracking, ambulance billing, fleet maintenance, and cemetery records management; and student information and transportation solutions for K-12 schools. The company also provides a suite of judicial solutions comprising court case management, court and law enforcement, prosecutor, and supervision systems to handle multi-jurisdictional county or statewide implementations, and single county systems; public safety software solutions; systems and software to automate the appraisal and assessment of real and personal property, as well as tax applications for agencies that bill and collect taxes; planning, regulatory, and maintenance software solutions for public sector agencies; software applications to enhance and automate operations involving records and document management; and data and insights solutions. In addition, it offers software as a service arrangements and electronic document filing solutions for courts and law offices; software and hardware installation, data conversion, training, product modification, and maintenance and support services; and property appraisal outsourcing services for taxing jurisdictions. The company has a strategic collaboration agreement with Amazon Web Services for cloud hosting services. Tyler Technologies, Inc. was founded in 1966 and is headquartered in Plano, Texas.
How the Company Makes MoneyTyler Technologies generates revenue primarily through the sale of software licenses, maintenance contracts, and subscription services. The company earns significant income from both one-time software license fees and ongoing subscription fees for its cloud-based products. Additionally, Tyler provides consulting and implementation services, which contribute to its revenue. Key partnerships with government agencies and organizations enhance its market presence and allow for tailored solutions that meet specific regulatory and operational needs, further driving sales and customer retention.
Tyler Technologies Earnings Call Summary
Earnings Call Date:Oct 29, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 18, 2026
Earnings Call Sentiment Positive
The earnings call reflects a strong performance with notable revenue and SaaS growth, successful acquisitions, and a positive outlook for 2026. However, there are challenges such as the decline in new SaaS ARR, the impact of the Texas payments contract wind down, and a slight decline in cash flow.Q3-2025 Updates
Positive Updates
Strong Revenue Growth
Total revenues for the quarter were $595.9 million, up 9.7%. SaaS revenues grew 20% to $199.8 million, and transaction revenues grew 11.5% to $201.3 million.
Record SaaS Bookings
Total SaaS bookings grew 5% sequentially and 5.8% year-over-year, reaching a new all-time high.
Public Safety Market Success
Tyler Technologies achieved significant public safety wins, including contracts with Coweta County, Georgia, and the City of Columbia, Missouri.
Successful Acquisitions
Acquisitions, such as Emergency Networking and MyGov, are contributing to growth, with Emergency Networking securing a statewide win in Pennsylvania.
Positive Outlook for 2026
For 2026, SaaS revenues are expected to grow approximately 20%, and total recurring revenue growth will be within the long-term target range of 10% to 12%.
Negative Updates
Decline in New SaaS ARR
New SaaS ARR declined 39% against a difficult comparison from the exceptional number of large deals last year.
Impact of Texas Payments Contract Wind Down
Revenues from the Texas payments contract are expected to decline, with an anticipated reduction from $39-$40 million this year to $4-$5 million next year.
Cash Flow Decline
Cash flows from operations and free cash flow were solid at $255.2 million and $247.6 million, respectively, but down slightly year-over-year due to the timing of working capital changes.
Company Guidance
During the third quarter conference call of 2025, Tyler Technologies reported strong financial performance and provided guidance for the remainder of the year and beyond. The company experienced a 9.7% increase in total revenues, reaching $595.9 million, with SaaS revenues growing by 20% to $199.8 million. Transaction revenues also saw a rise of 11.5% to $201.3 million. Total annual recurring revenue (ARR) grew by 10.7% to approximately $2.05 billion. Tyler Technologies updated its annual guidance for 2025, projecting total revenues between $2.335 billion and $2.360 billion, with a midpoint growth of around 10%. The company expects non-GAAP diluted EPS to range from $11.30 to $11.50, with a non-GAAP tax rate of 22.5%. Looking into 2026, Tyler anticipates SaaS revenue growth of approximately 20% and total recurring revenue growth within a long-term target range of 10% to 12%, excluding the Texas payments contract wind-down impact. The call emphasized Tyler's strategic focus on cloud transition, AI innovations, and expanding market presence.Tyler Technologies Financial Statement Overview
Summary
Tyler Technologies exhibits solid financial health with strong profitability and a stable balance sheet. The company effectively manages its costs, resulting in improved margins and a healthy return on equity. While cash flow generation is strong, the recent decline in free cash flow growth warrants monitoring.Income Statement
Tyler Technologies demonstrates strong profitability with a consistent increase in gross profit and net profit margins over the years. The TTM (Trailing-Twelve-Months) data shows a gross profit margin of 42.70% and a net profit margin of 13.66%, indicating efficient cost management. Revenue growth has been steady, albeit slowing from previous years, with a TTM growth rate of 2.34%. The EBIT and EBITDA margins have also improved, reflecting operational efficiency.Balance Sheet
The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.18 in the TTM, showcasing prudent financial leverage. Return on equity has improved to 8.89%, indicating effective use of shareholder funds. The equity ratio stands at 68.11%, suggesting a strong equity base relative to total assets, which enhances financial stability.Cash Flow
Operating cash flow remains robust, with a TTM operating cash flow to net income ratio of 2.01, indicating strong cash generation relative to net income. However, free cash flow growth has declined by 25.8% in the TTM, which could be a concern if the trend continues. The free cash flow to net income ratio remains high at 96.51%, reflecting efficient cash flow management.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.30B | 2.14B | 1.95B | 1.85B | 1.59B | 1.12B |
| Gross Profit | 1.02B | 876.13M | 786.47M | 722.50M | 664.79M | 520.85M |
| EBITDA | 527.40M | 466.47M | 392.63M | 388.01M | 328.12M | 256.70M |
| Net Income | 315.29M | 263.03M | 165.92M | 164.24M | 161.46M | 194.82M |
Balance Sheet | ||||||
| Total Assets | 5.46B | 5.18B | 4.68B | 4.69B | 4.73B | 2.61B |
| Cash, Cash Equivalents and Short-Term Investments | 950.82M | 767.98M | 175.88M | 210.89M | 361.47M | 675.81M |
| Total Debt | 643.45M | 638.37M | 696.89M | 1.05B | 1.39B | 22.18M |
| Total Liabilities | 1.85B | 1.79B | 1.74B | 2.06B | 2.41B | 621.16M |
| Stockholders Equity | 3.60B | 3.39B | 2.94B | 2.62B | 2.32B | 1.99B |
Cash Flow | ||||||
| Free Cash Flow | 618.93M | 604.10M | 327.43M | 331.30M | 316.14M | 326.62M |
| Operating Cash Flow | 634.43M | 624.63M | 380.44M | 381.45M | 371.75M | 355.09M |
| Investing Cash Flow | -197.05M | -67.61M | -76.96M | -172.53M | -2.09B | -98.32M |
| Financing Cash Flow | -141.58M | 22.21M | -311.84M | -344.24M | 1.42B | 114.17M |
Tyler Technologies Technical Analysis
Neutral
453.40
Price Trends
462.14
Negative
496.85
Negative
533.23
Negative
Market Momentum
-4.89
Positive
47.38
Neutral
53.01
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TYL, the sentiment is Neutral. The current price of 453.4 is below the 20-day moving average (MA) of 453.57, below the 50-day MA of 462.14, and below the 200-day MA of 533.23, indicating a bearish trend. The MACD of -4.89 indicates Positive momentum. The RSI at 47.38 is Neutral, neither overbought nor oversold. The STOCH value of 53.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TYL.
Tyler Technologies Risk Analysis
Tyler Technologies disclosed 36 risk factors in its most recent earnings report. Tyler Technologies reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Tyler Technologies Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $21.24B | 25.91 | 12.40% | 1.17% | 6.67% | 21.21% | |
75 Outperform | $10.47B | 49.34 | 73.58% | ― | 4.10% | -0.21% | |
71 Outperform | $8.36B | 38.48 | 20.42% | ― | 13.30% | 2.80% | |
66 Neutral | $19.51B | 63.13 | 9.17% | ― | 10.62% | 31.43% | |
65 Neutral | $8.27B | -75.97 | -12.84% | ― | 16.98% | -265.85% | |
63 Neutral | $15.34B | 171.09 | 6.57% | ― | 22.80% | 198.93% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
TYL
Tyler Technologies
453.40
-116.87
-20.49%
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180.41
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4.91%
MANH
Manhattan Associates
173.70
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SSNC
SS&C Technologies Holdings
88.93
12.74
16.72%
PCTY
Paylocity
153.73
-38.50
-20.03%
ESTC
Elastic
78.48
-19.51
-19.91%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.