Is Tyler Technologies, Inc. overvalued or undervalued?

As of 13 May 2025, the valuation grade for Tyler Technologies, Inc. has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently deemed overvalued. Key ratios highlight this valuation, with a P/E ratio of 100, an EV to EBIT of 89.51, and a Price to Book Value of 8.25, all of which are substantially higher than industry norms.
In comparison to peers, Tyler Technologies' P/E ratio of 100.77 starkly contrasts with GoDaddy, Inc.'s P/E of 32.65 and FactSet Research Systems, Inc.'s P/E of 31.75, underscoring its premium valuation. Additionally, the EV to EBITDA ratio of 61.48 further emphasizes the overvaluation when compared to Jacobs Solutions, Inc. at 13.66. Despite a strong one-year stock return of 18.59% compared to the S&P 500's 10.26%, the elevated valuation metrics suggest that Tyler Technologies may not sustain its current price levels in the long term.