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Tyler Technologies' (TYL) Solutions Find New Client in Virginia

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Tyler Technologies (TYL - Free Report) recently grabbed a major contract from Augusta County and Augusta County Public Schools in Virginia for the integration of its multiple applications from the public administration solution suite.

The solutions include Tyler’s Enterprise ERP software suite, which includes human resource management, financial management and asset management applications. By implementing Enterprise ERP solutions, Augusta County will be able to offer efficient services to the community, reduce the manual work of employees and provide better infrastructure for staff.

Apart from the Enterprise ERP software suite, Augusta County and Augusta County Public Schools have selected Tyler’s Enterprise Permitting and Licensing (“EPL”) solution to improve community services. The implementation of the EPL solution will make easier permitting and licensing processes for the community and help government personnel make more accurate community development planning.

Accelerated Cloud Adoptions Aid Tyler’s Growth

It is worth mentioning that Tyler has been benefiting from the public sector’s ongoing transition from on-premise and outdated systems to scalable cloud-based systems. TYL has been consistently enhancing its core software applications and expanding complementary product and service portfolios to cater to the changing needs of customers while keeping pace with technological advancements.

TYL has been pursuing strategic takeovers to broaden its product and service offerings, enter new markets related to local governments, attract clients and expand geographically. In August 2023, the company completed the acquisition of Orlando, FL-headquartered Computing System Innovations, LLC (“CSI”) to enhance its electronic filing and redaction solutions.

Tyler intends to integrate CSI’s artificial intelligence (AI)-driven redaction and indexing solution, Intellidact Platform, into its eFile & Serve solution portfolio to automate data entry and document processing options for its clientele. It is also likely to leverage CSI’s AI and automation solution across its other verticals like Municipal & Schools, Property & Recording and Platform Solutions.

In March 2023, the company revealed that it acquired a Massachusetts-based analytics company offering exemplary real estate appraisals and assessments for states, counties and municipalities — Safeground Analytics.

With this buyout, this Zacks Rank #3 (Hold) company intends to accelerate its appraisal service businesses by bringing a team of experienced appraisers, analysts, statisticians, economists, computer scientists and assessors from Safeground Analytics. The analytics company will offer TYL residential and commercial reassessments and deliver litigation support, expert witness testimony solutions for property appraisal matters, and auditing and monitoring services.

However, Tyler’s near-term growth prospects are likely to be affected by delays in procurement processes and lengthening sales cycles amid ongoing macroeconomic uncertainties. Also, many customers are expected to face budget pressures in the near term.

Additionally, high investments in R&D initiatives are likely to hurt margins. Intensifying competition from the likes of Oracle, SAP and Workday might keep Tyler’s pricing under pressure and negatively impact the gross margin.

Stocks to Consider

Some better-ranked stocks from the broader technology sector are NVIDIA (NVDA - Free Report) , Paylocity Holding (PCTY - Free Report) and Palo Alto Networks (PANW - Free Report) . NVIDIA Sports a Zacks Rank #1 (Strong Buy), while Palo Alto Networks and Paylocity each carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for NVIDIA's third-quarter fiscal 2024 earnings has been revised upward by 8 cents to $3.32 per share in the past 30 days. For fiscal 2024, earnings estimates have increased by 21 cents to $10.67 per share in the past 30 days.

NVIDIA’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing on one occasion, the average surprise being 9.8%. Shares of NVDA have surged 198% year to date.

The Zacks Consensus Estimate for Paylocity’s first-quarter fiscal 2024 earnings has dropped by a penny to $1.07 per share in the past 60 days. For fiscal 2024, earnings estimates have moved 14 cents upward to $5.58 per share in the past 60 days.

Paylocity’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 39.7%. Shares of PCTY have declined 3.4% year to date.

The Zacks Consensus Estimate for Palo Alto Networks' first-quarter fiscal 2024 earnings has been revised upward by 6 cents to $1.16 per share in the past 60 days. For fiscal 2024, earnings estimates have increased by 38 cents to $5.34 per share in the past 60 days.

Palo Alto Networks’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 22.2%. Shares of PANW have surged 66.1% year to date.

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