On Friday, Baird maintained its Outperform rating on shares of Tyler Technologies, Inc. (NYSE:TYL), while increasing the price target to $525 from the previous $500. The firm's decision follows Tyler Tech's reported strong quarterly results and an upward revision of its 2024 guidance.
Tyler Tech, which provides integrated software and technology services to the public sector, has shown a robust quarter performance that exceeded expectations. The company's raised guidance for 2024 comes amid a healthy government spending environment, particularly noting the momentum in Public Safety deals transitioning to cloud-based services.
The firm anticipates Tyler Tech's software-as-a-service (SaaS) growth to persist in the low-20 percent range. Despite some fluctuations in Transaction revenue due to a large contract shifting from gross to net, the firm expresses confidence in Tyler Tech's guidance for 2024 and its long-term financial targets.
Baird highlighted the continued strength in the government spending environment as a key factor in Tyler Tech's success. The firm also pointed out that the company's move to cloud-based services is gaining traction, which is a positive sign for future growth.
The firm is looking forward to attending Tyler Tech's user conference scheduled for late May. The conference is expected to provide further insights into the company's cross-sell opportunities, which could enhance its market position. Baird reiterated its confidence in Tyler Tech by naming it a top mid-cap idea.
InvestingPro Insights
Following the positive outlook from Baird, InvestingPro data further underscores Tyler Technologies, Inc.'s (NYSE:TYL) market position. The company boasts a substantial market capitalization of $19.38 billion, reflecting its significant presence in the software and technology sector catering to the public sector. Despite a high P/E ratio of 103.9, which suggests a premium valuation, the company has experienced a 13.57% return over the last week, indicating strong investor confidence in its growth trajectory.
InvestingPro Tips highlight that analysts have revised their earnings upwards for the upcoming period, which aligns with the optimism expressed by Baird. Additionally, Tyler Tech is trading near its 52-week high, at 98.63% of this peak, suggesting a bullish trend in its stock price. For investors seeking more insights, there are 17 additional InvestingPro Tips available, which can be accessed for Tyler Technologies at https://www.investing.com/pro/TYL. To enrich your investment analysis, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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