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What's in the Offing for Tyler Technologies' (TYL) Q2 Earnings?

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Tyler Technologies (TYL - Free Report) is slated to report second-quarter 2021 results on Jul 28.

The Zacks Consensus Estimate for second-quarter earnings is pegged at $1.65 per share, suggesting a year-over-year increase of 19.6%. Further, the consensus mark for revenues is pinned at $370.9 million, calling for a 36.6% increase from the year-ago quarter.

In the trailing four quarters, Tyler’s earnings beat the Zacks Consensus Estimate on three occasions and missed in the other, the average surprise being 9.7%.

In the last reported quarter, Tyler’s non-GAAP earnings of $1.43 per share surpassed the Zacks Consensus Estimate by 12 cents. Moreover, revenues of $294.8 million beat the consensus mark of $288 million.

Tyler Technologies, Inc. Price and EPS Surprise

Tyler Technologies, Inc. Price and EPS Surprise

Tyler Technologies, Inc. price-eps-surprise | Tyler Technologies, Inc. Quote

Let’s see how things have shaped up for the upcoming announcement.

Factors at Play

Tyler’s second-quarter performance is likely to have been positively impacted by big-value deals in public safety. In addition, the company’s recently-closed acquisitions are anticipated to have brought in incremental revenues during the quarter under review.

This April, Tyler completed the proposed acquisition of NIC Inc. to bank on the pandemic-induced shift to online services and electronic payments by governments. This buyout will likely be accretive to Tyler’s non-GAAP earnings, EBITDA, recurring revenue mix and free cash flow per share in 2021.

In the same month, Tyler purchased cloud-based school scheduling platform, ReadySub, to expand and strengthen its school portfolio. In late March, the company announced the acquisition of DataSpec, a veterans’ claim management software firm, for an undisclosed amount. Apart from enhancing client base, these acquisitions are anticipated to have created opportunities of cross selling for Tyler, thereby boosting its revenues during the second quarter.

However, the pandemic-induced economic and business disruptions might have continued hurting the company’s top line during the period in discussion.

Delays in procurement processes and lengthening sales cycles, as public sector entities are now more focused on pandemic-related issues, might have hurt its revenues in the quarter under review. During its first-quarter earnings call, the company had stated that longer sales cycles and delays in procurement processes had negatively impacted its software licenses and services revenues.

Besides, higher employee healthcare expenses are expected to have eroded Tyler’s operating margins during the quarter under review.

What Our Model Says

Our proven model does not predict an earnings beat for Tyler this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Though Tyler currently sports a Zacks Rank of 1, it has an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming release:

Avnet, Inc. (AVT - Free Report) has an Earnings ESP of +0.66% and currently flaunts a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Apple Inc. (AAPL - Free Report) has an Earnings ESP of +3.40% and carries a Zacks Rank #2, at present.

Facebook has an Earnings ESP of +7.52% and holds a Zacks Rank of 3, currently.


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