Critical Analysis: Tyler Technologies (NYSE:TYL) & Blackline (NYSE:BL)

Tyler Technologies (NYSE:TYL) and Blackline (NASDAQ:BL) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Tyler Technologies and Blackline, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tyler Technologies 0 2 6 0 2.75
Blackline 1 1 2 0 2.25

Tyler Technologies presently has a consensus target price of $268.43, suggesting a potential downside of 3.35%. Blackline has a consensus target price of $52.67, suggesting a potential upside of 6.40%. Given Blackline’s higher possible upside, analysts plainly believe Blackline is more favorable than Tyler Technologies.

Profitability

This table compares Tyler Technologies and Blackline’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tyler Technologies 12.63% 11.51% 8.40%
Blackline -10.20% -4.05% -2.62%

Earnings and Valuation

This table compares Tyler Technologies and Blackline’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tyler Technologies $935.28 million 11.58 $147.46 million $3.74 74.26
Blackline $227.79 million 12.02 -$27.80 million ($0.26) -190.38

Tyler Technologies has higher revenue and earnings than Blackline. Blackline is trading at a lower price-to-earnings ratio than Tyler Technologies, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

88.1% of Tyler Technologies shares are owned by institutional investors. Comparatively, 84.1% of Blackline shares are owned by institutional investors. 4.4% of Tyler Technologies shares are owned by insiders. Comparatively, 15.8% of Blackline shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

Tyler Technologies has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500. Comparatively, Blackline has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500.

Summary

Tyler Technologies beats Blackline on 11 of the 14 factors compared between the two stocks.

About Tyler Technologies

Tyler Technologies, Inc. provides integrated information management solutions and services for the public sector in the United States and internationally. The company operates in two segments, Enterprise Software, and Appraisal and Tax. It offers financial management solutions, including modular fund accounting systems for government agencies or not-for-profit entities; utility billing systems for the billing and collection of metered and non-metered services; products to automate city and county functions, such as municipal courts, parking tickets, equipment and project costing, animal and business licenses, permits and inspections, code enforcement, citizen complaint tracking, ambulance billing, fleet maintenance, and cemetery records management; and student information and transportation solutions for K-12 schools. The company also provides a suite of judicial solutions comprising court case management, court and law enforcement, prosecutor, and supervision systems to handle multi-jurisdictional county or statewide implementations, and single county systems; public safety software solutions; systems and software to automate the appraisal and assessment of real and personal property, as well as tax applications for agencies that bill and collect taxes; planning, regulatory, and maintenance software solutions for public sector agencies; software applications to enhance and automate land and other records and document management; and data and insights solutions. In addition, it offers software as a service arrangements and electronic document filing solutions for courts and law offices; software and hardware installation, data conversion, training, product modification, and maintenance and support services; and property appraisal outsourcing services for taxing jurisdictions. The company was founded in 1966 and is based in Plano, Texas.

About Blackline

BlackLine, Inc. provides financial accounting close solutions delivered primarily as Software as a Service in the United States and internationally. Its solutions enable its customers to address various aspects of their financial closing process, including account reconciliations, variance analysis of account balances, journal entry capabilities, and range of data matching capabilities. The company's platform consists of nine core cloud-based products, including Transaction Matching, Account Reconciliations, Consolidation Integrity Manager, Daily Reconciliations, Journal Entry, Variance Analysis, Task Management, Compliance, and Insights. Its solutions include balance sheet integrity, close process management, accounting process automation, finance transformation, intercompany hub, and smart close. The company designs its products to complement enterprise resource planning and other financial systems, including NetSuite, Oracle, SAP, and Workday; and financial close management and accounting automation from within a single, unified cloud platform. It has strategic alliances with technology vendors, such as SAP and NetSuite; professional services firms, including Deloitte, Ernst & Young, and KPMG; and business process outsourcers, such as Cognizant, Genpact, and IBM. The company sells its solutions primarily through direct sales force to multinational corporations, large domestic enterprises and mid-market companies across various industries. The company was founded in 2001 and is headquartered in Woodland Hills, California.

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