Tyler Earnings: Management Raises 2024 Outlook as Cross-Selling Efforts Are Gaining Momentum

We are raising our fair value estimate to $500 per share from $485 for wide-moat Tyler after the firm reported solid first-quarter results and took the unusual step of modestly raising its full-year outlook on both the top and bottom lines. Compared with our expectations, both revenue and non-GAAP operating profit were slightly ahead. We continue to see shares as attractive and are encouraged by management’s assertion that cross-selling and upselling motions are gaining momentum and its bullish assessment of the demand environment. We continue to see federal stimulus funds as supporting the healthy environment and see consistent growth and margin expansion over time driven by the maturation of the cloud transition and think that as the leader in local government software Tyler should benefit.