Here is Why Tyler Tech (TYL) is One of the Best Enterprise Software Stocks

Tyler Technologies Inc. (NYSE:TYL) is one of the best enterprise software stocks to buy right now. On April 29, Tyler Technologies reported record-breaking Q1 2026 results, with total revenues rising 8.6% to $613.5 million. This growth was driven by a 10.4% increase in recurring revenues, which now account for ~88% of the company’s total top line. Notably, SaaS revenues surged 23.5% to $222.4 million, marking the 21st consecutive quarter of growth exceeding 20% in this segment.

Profitability and cash flow showed significant strength, as adjusted EBITDA reached $177.3 million and non-GAAP diluted EPS grew to $3.09. Free cash flow more than doubled compared to the prior-year period, hitting $102.8 million. The company utilized its strong liquidity to manage capital effectively, repaying $600 million in maturing convertible debt and executing $250 million in share repurchases during the quarter.

Strategically, Tyler Technologies Inc. (NYSE:TYL) expanded its Justice portfolio through the $223 million acquisition of For The Record in April, adding AI-powered transcription and speech-to-text capabilities. Following these results, the company provided full-year 2026 guidance, projecting total revenues between $2.535 billion and $2.575 billion. Management expressed confidence in its trajectory toward 2030 goals, supported by healthy public sector demand and ongoing cloud efficiency gains.

Tyler Technologies Inc. (NYSE:TYL) provides software and technology management solutions and serves the public sector. The company operates through the Platform Technologies and Enterprise Software segments.

While we acknowledge the potential of TYL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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