Tyler Technologies TYL shares soared 4.7% in the last trading session to close at $294.4. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 8.2% loss over the past four weeks.
The optimism surrounding the stock can be attributed to the public sector’s multi-year shift from on-premise and outdated systems to scalable cloud-based systems and digital payments. The growing hybrid working trend is also driving the demand for its connectivity and cloud services.
This information management software provider is expected to post quarterly earnings of $3.12 per share in its upcoming report, which represents a year-over-year change of +7.2%. Revenues are expected to be $646.95 million, up 8.5% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Tyler Technologies, the consensus EPS estimate for the quarter has been revised 3.4% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on TYL going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Tyler Technologies is a member of the Zacks Internet - Software and Services industry. One other stock in the same industry, Donnelley Financial Solutions DFIN, finished the last trading session 2.4% higher at $40.55. DFIN has returned -0.7% over the past month.
For Donnelley Financial, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.65. This represents a change of +10.7% from what the company reported a year ago. Donnelley Financial currently has a Zacks Rank of #2 (Buy).
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See Stocks Now >>Tyler Technologies, Inc. (TYL) : Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
