Examining Tyler Technologies Inc’s (NYSE:TYL) past track record of performance is a valuable exercise for investors. It enables us to understand whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess TYL’s latest performance announced on 30 September 2017 and weigh these figures against its longer term trend and industry movements. Check out our latest analysis for Tyler Technologies
Were TYL’s earnings stronger than its past performances and the industry?
I use the ‘latest twelve-month’ data, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This allows me to assess many different companies in a uniform manner using new information. Tyler Technologies’s most recent twelve-month earnings is $133.3M, which, relative to the prior year’s figure, has increased by an impressive 52.78%. Since these values are relatively short-term, I’ve created an annualized five-year value for Tyler Technologies’s earnings, which stands at $57.1M. This means on average, Tyler Technologies has been able to gradually grow its bottom line over the last few years as well.
How has it been able to do this? Let’s see whether it is merely because of an industry uplift, or if Tyler Technologies has experienced some company-specific growth. In the last couple of years, Tyler Technologies expanded its bottom line faster than revenue by effectively controlling its costs. This has caused a margin expansion and profitability over time. Viewing growth from a sector-level, the US software industry has been growing its average earnings by double-digit 18.04% over the past year, and 11.55% over the past couple of years. This shows that whatever tailwind the industry is enjoying, Tyler Technologies is capable of amplifying this to its advantage.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Tyler Technologies gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research Tyler Technologies to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for TYL’s future growth? Take a look at our free research report of analyst consensus for TYL’s outlook.
2. Financial Health: Is TYL’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.