Tyler Technologies Inc (TYL, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $460, Tyler Technologies Inc has witnessed a daily loss of 0.16%, marked against a three-month change of 5.15%. A thorough analysis, underlined by the GF Score, suggests that Tyler Technologies Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 5/10
- Momentum rank: 8/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in financial strength, profitability, and growth, but a moderate GF Value rank, GuruFocus assigned Tyler Technologies Inc the GF Score of 97 out of 100, which signals the highest outperformance potential.
Understanding Tyler Technologies Inc Business
Tyler Technologies Inc is a leading provider of integrated software solutions and services for the public sector, with a market capitalization of $19.53 billion and sales of $1.99 billion. The company boasts an operating margin of 12.07%, reflecting its efficiency in managing operations. Tyler Technologies Inc's core products include Munis, an ERP system; Odyssey, a court management system; and various payment solutions. Additionally, the company offers add-on modules and outsourced property tax assessment services, catering to cities, counties, schools, courts, and other local government entities.
Financial Strength Breakdown
According to the Financial Strength rating, Tyler Technologies Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Tyler Technologies Inc stands impressively at 13.27, underscoring its strong capability to cover its interest obligations. This robust financial position resonates with the wisdom of legendary investor Benjamin Graham, who favored companies with an interest coverage ratio of at least 5. With an Altman Z-Score of 8.5, Tyler Technologies Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. With a favorable Debt-to-Revenue ratio of 0.32, Tyler Technologies Inc's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows Tyler Technologies Inc's impressive standing among its peers in generating profit. The Piotroski F-Score confirms Tyler Technologies Inc's solid financial situation based on Joseph Piotroski's nine-point scale, which measures a company's profitability, funding and operating efficiency. Tyler Technologies Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, Tyler Technologies Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 19.3%, which outperforms better than 72.47% of 2448 companies in the Software industry. Moreover, Tyler Technologies Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 13.9, and the rate over the past five years is 12.8. This trend accentuates the company's continued capability to drive growth.
Next Steps
Considering Tyler Technologies Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking to capitalize on such robust financial health and promising growth trajectory should consider the insights provided by the GF Score. For those looking to explore further, GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
