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Tyler Technologies (TYL)
NYSE:TYL
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Tyler Technologies
(NYSE:TYL)
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Rating:71Outperform
Price Target:
$620.00
▲(17.04% Upside)
Tyler Technologies' strong financial performance and positive earnings call sentiment are key strengths, driving the overall score. However, high valuation metrics and mixed technical indicators present potential risks. The company's strategic initiatives and robust growth in SaaS and transaction revenues support a positive outlook, but investors should be cautious of valuation concerns.
Positive Factors
SaaS Revenue Growth
Consistent SaaS revenue growth indicates strong demand for Tyler's cloud solutions, enhancing recurring revenue streams and supporting long-term financial stability.
Strategic Acquisition
The acquisition broadens Tyler's product offerings and market reach, strengthening its competitive position in the public safety sector and supporting future growth.
Recognition in Gartner Magic Quadrant
This recognition validates Tyler's market leadership and innovation in cloud-based ERP solutions, enhancing its reputation and attractiveness to potential clients.
Negative Factors
Professional Services Revenue Decline
A decline in professional services revenue may indicate challenges in service delivery or client retention, potentially impacting overall revenue growth and client satisfaction.
SaaS ARR Fluctuations
Fluctuations in SaaS ARR could signal volatility in subscription renewals or client acquisition, affecting the predictability of future revenues.
Federal Spending Environment Impact
Uncertainty in federal spending could delay government contracts, impacting Tyler's revenue from public sector clients and hindering growth prospects.
Tyler Technologies (TYL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$22.92B
Dividend YieldN/A
Average Volume (3M)312.54K
Price to Earnings (P/E)75.7
Beta (1Y)0.74
Revenue Growth10.69%
EPS Growth45.43%
CountryUS
Employees7,462
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)3.01
Shares Outstanding43,261,810
10 Day Avg. Volume379,799
30 Day Avg. Volume312,544
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue11.48
Enterprise Value/Gross Profit26.90
Enterprise Value/Ebitda50.30
Forecast
1Y Price Target
$682.54Price Target Upside28.85% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
Tyler Technologies Business Overview & Revenue Model
Company DescriptionTyler Technologies, Inc. is a leading provider of integrated software and technology services for the public sector. Founded in 1966 and headquartered in Plano, Texas, Tyler specializes in solutions for local governments, including software for financial management, public safety, and citizen services. The company serves various sectors, including law enforcement, education, and municipal management, and is recognized for its innovative products designed to enhance operational efficiency and improve service delivery for government agencies.
How the Company Makes MoneyTyler Technologies generates revenue primarily through the sale of software licenses, maintenance contracts, and professional services. The company offers subscription-based software solutions, allowing clients to pay annually for access to their platforms. Key revenue streams include the sale of its ERP (Enterprise Resource Planning) systems, public safety software, and court case management systems. Additionally, Tyler earns revenue from consulting services that assist in the implementation and integration of its software solutions. Strategic partnerships with government entities and industry collaborations enhance its market reach and contribute to its earnings, as does the increasing demand for digital transformation in the public sector. The company's commitment to innovation and expansion into new markets further bolsters its financial performance.
Tyler Technologies Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth, particularly in SaaS and transaction-based revenues, alongside increased free cash flow and operating margin expansion. The acquisition of Emergency Networking and recognition in the Gartner Magic Quadrant are seen as strong strategic moves. However, there were some challenges, such as a decline in professional services revenue and fluctuations in SaaS ARR. The overall sentiment is positive, driven by strong financial performance and strategic positioning despite some operational challenges.Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Total revenues for the quarter were $596.1 million, up 10.2% from the previous year.
SaaS Revenue Increase
SaaS revenues grew 21.5% to $189.6 million, marking the 18th consecutive quarter of SaaS growth over 20%.
Record Transaction Revenue
Transaction-based revenue grew 21.3%, surpassing $200 million for the first time.
Operating Margin Expansion
Non-GAAP operating margin expanded 200 basis points to 26.5%.
Significant Free Cash Flow Increase
Free cash flow grew 80.9% to $88 million, significantly exceeding expectations.
Strong SaaS Bookings
SaaS bookings were up 47.7% sequentially from Q1 and up 8.2% year-over-year.
Acquisition of Emergency Networking
Acquisition expands Tyler's TAM and adds an important piece to Tyler's public safety portfolio.
Recognition in Gartner Magic Quadrant
Recognized as a Leader and Visionary in the Gartner Magic Quadrant for Cloud-Based ERP for U.S. Local Government.
Negative Updates
Professional Services Revenue Decline
Professional services revenues declined 18.5% to $58.6 million.
SaaS ARR Fluctuations
While the number of SaaS flips grew modestly, the total ARR from SaaS flips was down 9.2% year-over-year.
Challenges in Large Deal Timing
Large deals in the court space remain lumpy and timing is uncertain.
Potential Impact of Federal Spending Environment
Some delays or cancellations of procurement processes related to the macro environment and noise around federal funding.
Company Guidance
During the Tyler Technologies Second Quarter 2025 Conference Call, the guidance for the rest of the fiscal year was updated with several key metrics. Total revenues for 2025 are projected to be between $2.33 billion and $2.36 billion, implying a growth of approximately 10%. GAAP diluted EPS is expected to range from $7.40 to $7.70, while non-GAAP diluted EPS is forecasted between $11.20 and $11.50. The company anticipates a non-GAAP tax rate of 22.5% and a free cash flow margin between 25% and 27%. Subscription revenues are expected to grow by 17% to 19%, with SaaS revenue specifically projected to increase by 21% to 23%. Transaction revenues are anticipated to grow between 14% and 16%. Maintenance and professional services revenues are both expected to decline, by 4% to 6% and 3% to 6% respectively. The guidance reflects Tyler's strong performance in the second quarter, driven by a robust sales pipeline, continued SaaS growth, and strategic initiatives like the cloud transition and expansion into new markets.Tyler Technologies Financial Statement Overview
Summary
Tyler Technologies demonstrates strong financial performance with consistent revenue and profit growth, efficient cost management, and solid cash flow generation. The balance sheet is healthy with manageable debt levels and strong equity, although liabilities are significant.Income Statement
Tyler Technologies demonstrates strong revenue growth with a consistent increase in total revenue from $1.59 billion in 2021 to $2.25 billion TTM (Trailing-Twelve-Months) in 2025. The gross profit margin remains robust at 45.2% TTM, indicating efficient cost management. The net profit margin improved to 13.7% TTM, reflecting enhanced profitability. EBIT and EBITDA margins are stable, suggesting operational efficiency.85
Very Positive
Balance Sheet
The company's balance sheet is solid with increasing stockholders' equity, reaching $3.63 billion TTM. The debt-to-equity ratio is favorable at 0.18, showing prudent leverage management. ROE improved to 8.4% TTM, indicating effective utilization of equity. The equity ratio of 69.1% TTM reflects a strong equity base, but the total liabilities remain significant.78
Positive
Cash Flow
Tyler Technologies exhibits strong cash flow management with free cash flow increasing to $620.5 million TTM. The operating cash flow to net income ratio of 2.10 TTM highlights robust cash generation relative to net income. Free cash flow growth is steady, supporting financial flexibility and potential for reinvestment or shareholder returns.82
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.25B | 2.14B | 1.95B | 1.85B | 1.59B | 1.12B |
| Gross Profit | 958.91M | 876.13M | 786.47M | 722.50M | 664.79M | 520.85M |
| EBITDA | 512.74M | 466.47M | 392.63M | 388.01M | 328.12M | 256.70M |
| Net Income | 306.80M | 263.03M | 165.92M | 164.24M | 161.46M | 194.82M |
Balance Sheet | ||||||
| Total Assets | 5.43B | 5.18B | 4.68B | 4.69B | 4.73B | 2.61B |
| Cash, Cash Equivalents and Short-Term Investments | 892.35M | 767.98M | 175.88M | 210.89M | 361.47M | 675.81M |
| Total Debt | 641.72M | 638.37M | 696.89M | 1.05B | 1.39B | 22.18M |
| Total Liabilities | 1.79B | 1.79B | 1.74B | 2.06B | 2.41B | 621.16M |
| Stockholders Equity | 3.63B | 3.39B | 2.94B | 2.62B | 2.32B | 1.99B |
Cash Flow | ||||||
| Free Cash Flow | 620.53M | 604.10M | 327.43M | 331.30M | 316.14M | 326.62M |
| Operating Cash Flow | 642.96M | 624.63M | 380.44M | 381.45M | 371.75M | 355.09M |
| Investing Cash Flow | -151.27M | -67.61M | -76.96M | -172.53M | -2.09B | -98.32M |
| Financing Cash Flow | 45.03M | 22.21M | -311.84M | -344.24M | 1.42B | 114.17M |
Tyler Technologies Technical Analysis
Negative
529.72
Price Trends
560.16
Negative
566.92
Negative
576.32
Negative
Market Momentum
-10.33
Positive
39.66
Neutral
23.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TYL, the sentiment is Negative. The current price of 529.72 is below the 20-day moving average (MA) of 543.35, below the 50-day MA of 560.16, and below the 200-day MA of 576.32, indicating a bearish trend. The MACD of -10.33 indicates Positive momentum. The RSI at 39.66 is Neutral, neither overbought nor oversold. The STOCH value of 23.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 | $21.46B | 27.68 | 11.63% | 1.16% | 6.75% | 15.99% | |
77 Outperform | $12.59B | 29.43 | 31.85% | 0.69% | 10.21% | -10.56% | |
75 Outperform | $9.03B | 40.75 | 18.41% | ― | 13.74% | 10.99% | |
71 Outperform | $22.92B | 75.75 | 9.07% | ― | 10.69% | 45.43% | |
69 Neutral | $27.28B | -2,289.96 | -0.58% | ― | 18.96% | 58.78% | |
68 Neutral | $19.47B | 288.46 | 4.79% | ― | 22.64% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
TYL
Tyler Technologies
529.72
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-9.25%
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Tyler Technologies Corporate Events
Executive/Board ChangesShareholder Meetings
Tyler Technologies CEO Nominated as Board Chair
Neutral
Jul 23, 2025
In a strategic move for Tyler Technologies, the independent directors of the Board have unanimously agreed to nominate H. Lynn Moore, Jr., the current President and CEO, to assume the role of Board Chair at the 2026 Annual Meeting. This decision follows Mr. Marr’s choice not to stand for reelection, and the Board plans to maintain a Lead Independent Director to ensure governance balance as the Board Chair will not be independent.
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.