Sylogist (SYZ) AI Stock Analysis

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Sylogist

(TSX:SYZ)

68Neutral

Sylogist's overall stock score reflects its strong strategic execution and growth in SaaS bookings and ARR, despite concerns about revenue declines and high leverage. The stock's technical indicators suggest short-term positivity but caution is advised due to overbought signals. The negative P/E ratio and low dividend yield impact its valuation score.

Sylogist (SYZ) vs. S&P 500 (SPY)

Market Cap

C$176.36M

Dividend Yield0.53%

Average Volume (3M)48.26K

Price to Earnings (P/E)―

Beta (1Y)0.70

Revenue Growth-13.99%

EPS Growth-421.95%

CountryCA

Employees200

SectorTechnology

Sector Strength40

IndustrySoftware - Application

Share Statistics

EPS (TTM)-0.03

Shares Outstanding23,389,578

10 Day Avg. Volume37,168

30 Day Avg. Volume48,258

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)2.89

Price to Cash Flow (P/CF)33.00

P/FCF Ratio123.30

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$13.25

Price Target Upside87.41% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Sylogist Business Overview & Revenue Model

Company DescriptionSylogist Ltd. (SYZ) is a Canadian public company that provides enterprise resource planning (ERP) solutions primarily to public sector organizations and non-profit entities. The company's core products and services include financial management software, human resources management, and customer relationship management solutions, aimed at improving operational efficiency and financial transparency for its clients. Sylogist operates across various sectors including education, government, and non-profit, offering tailored solutions to meet sector-specific needs.

How the Company Makes MoneySylogist makes money primarily through the sale of its software solutions and related services. Its revenue model is based on software licensing fees, which can be perpetual or subscription-based, depending on the client's preference. In addition to licensing, the company generates revenue from professional services such as software implementation, customization, training, and ongoing support. Sylogist also offers cloud-based solutions, which provide recurring revenue streams through subscription models. Strategic partnerships with other technology providers and a strong focus on customer retention contribute significantly to its earnings by enhancing its solution offerings and maintaining long-term client relationships.

Sylogist Financial Statement Overview

Summary

Sylogist demonstrates solid profitability and cash flow generation, with a strong gross profit margin and effective cash conversion. However, recent revenue declines and growing debt levels are concerns, suggesting the need for revitalizing growth and managing leverage.

Income Statement

Positive

Sylogist has shown consistent profitability with a strong gross profit margin and reasonable net profit margin. However, the revenue growth has been negative recently, indicating potential challenges in expanding sales. EBIT and EBITDA margins remain healthy, but the decline in these metrics year-over-year suggests a need to enhance operational efficiency.

Balance Sheet

Positive

The company maintains a solid equity base, evident from its favorable equity ratio. However, the debt-to-equity ratio has increased, highlighting a growing reliance on debt financing. Return on equity has decreased, indicating reduced profitability from shareholder investments.

Cash Flow

Positive

Sylogist showcases strong free cash flow generation, although there has been a decline in free cash flow growth recently. The operating cash flow to net income ratio remains robust, reflecting effective cash management. The free cash flow to net income ratio is positive, underscoring the company's ability to convert earnings into cash.

Dec 2023	Dec 2022	Sep 2021	Sep 2020	Sep 2019
Breakdown
Income Statement		Total Revenue
65.51M	69.00M	38.67M	38.08M	37.61M
	Gross Profit
29.39M	30.63M	27.96M	28.05M	28.49M
	EBIT
908.00K	2.48M	7.72M	3.34M	13.39M
	EBITDA
11.05M	15.41M	14.50M	7.64M	17.18M
	Net Income Common Stockholders
1.10M	2.54M	4.37M	1.92M	10.01M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.61M	14.54M	29.59M	42.80M	53.10M
	Total Assets
96.58M	103.06M	98.03M	70.96M	78.19M
	Total Debt
17.74M	21.97M	19.03M	498.00K	0.00
	Net Debt
6.13M	7.43M	-10.56M	-42.30M	-53.10M
	Total Liabilities
58.98M	63.16M	51.34M	19.08M	19.69M
	Stockholders Equity
37.60M	39.91M	46.69M	51.87M	58.50M
Cash Flow		Free Cash Flow
4.75M	9.32M	17.99M	2.53M	16.37M
	Operating Cash Flow
9.93M	12.65M	18.82M	3.48M	16.99M
	Investing Cash Flow
-5.18M	-17.73M	-38.40M	-3.96M	70.00K
	Financing Cash Flow
-7.47M	-9.95M	7.77M	-10.16M	4.41M

Sylogist Technical Analysis

Technical Analysis Sentiment

Negative

Last Price7.07

Price Trends

50DMA

9.20

Negative

100DMA

9.36

Negative

200DMA

10.06

Negative

Market Momentum

MACD

-0.37

Positive

RSI

33.77

Neutral

STOCH

20.45

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SYZ, the sentiment is Negative. The current price of 7.07 is below the 20-day moving average (MA) of 8.17, below the 50-day MA of 9.20, and below the 200-day MA of 10.06, indicating a bearish trend. The MACD of -0.37 indicates Positive momentum. The RSI at 33.77 is Neutral, neither overbought nor oversold. The STOCH value of 20.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:SYZ.

Sylogist Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DSG	80 Outperform	$11.68B	60.17	10.92%	―	16.07%	25.71%
ENGH	76 Outperform	$1.32B	15.62	14.76%	4.51%	8.11%	15.83%
OTEX	69 Neutral	$9.07B	10.17	16.00%	4.29%	-3.59%	432.46%
SYZ	68 Neutral	C$176.36M	―	-1.93%	0.53%	-13.99%	-421.95%
KXS	68 Neutral	C$4.45B	157.81	-0.10%	―	14.85%	-105.25%
CSU	63 Neutral	C$92.50B	92.37	30.90%	0.13%	21.56%	31.90%
Sector *	57 Neutral	$18.52B	9.81	-13.96%	2.71%	5.07%	-23.65%

* Technology Sector Average

Performance Comparison

TSE:SYZ

Sylogist

7.07

-2.39

-25.26%

TSE:ENGH

Enghouse Systems

23.08

-5.86

-20.25%

TSE:DSG

The Descartes Systems Group

133.99

11.24

9.16%

TSE:OTEX

Open Text

33.07

-15.76

-32.28%

TSE:KXS

Kinaxis Inc

160.54

7.44

4.86%

TSE:CSU

Constellation Software

4,284.13

624.46

17.06%

Sylogist Earnings Call Summary

Earnings Call Date: Mar 13, 2025 | % Change Since: -19.29% | Next Earnings Date: May 8, 2025

Earnings Call Sentiment Positive

The earnings call reflects a strong transition to an ARR-driven model with significant growth in bookings and successful expansion of the partner network. Despite a slight decline in overall revenue and gross margins, the company has improved customer satisfaction and retained high SaaS ARR growth. The strategic investments and shift to a partner-led model are expected to enhance future profitability.

Highlights

Strong Transition to ARR-Driven Model

Recurring revenue reached 72% of total revenue, with significant growth in bookings and a strong net revenue retention rate of 108%. SaaS ARR increased by 17% year-over-year to $31 million.

Significant Growth in Bookings

Bookings grew by 63% year-over-year, driven by new logo wins and successful upsells and cross-sells, with 40% of bookings from the SylogistEd sector.

Partner Network Expansion

Partner-attached bookings represented 32% of total bookings, up from 12% in Q4 2023, with 60% of bookings in the SylogistMission and SylogistGov sectors being partner-attached.

Improved Customer Satisfaction

Net Promoter Score increased by more than 20% year-over-year to 62, reflecting strong customer trust and advocacy.

Lowlights

Revenue Decline

Q4 revenue was $15.3 million, down 1% year-over-year, primarily due to declines in project services revenue and hardware.

Gross Margin Compression

Q4 gross margins declined to 59% from 62% last year due to the shift to a partner-led delivery model.

Increased Operating Expenses

G&A expenses increased by $0.3 million in Q4 2024 to $2.7 million, representing 17% of revenue versus 15% last year. Sales and marketing expenses also rose, reflecting strategic investments.

Company Guidance

During the Sylogist Limited Fourth Quarter and Full Year 2024 Results Conference Call, the company emphasized its transition to an ARR-driven enterprise, with recurring revenue now constituting 72% of total revenue. The quarter saw a significant 63% year-over-year growth in bookings, with nearly 40% from the SylogistEd sector. Partner-attached bookings rose to 32% of total bookings, up from 12% the previous year, demonstrating the success of the partner strategy, particularly in the SylogistMission and SylogistGov segments. SaaS ARR grew by 17% to $31 million, and SaaS NRR improved to 108%. However, gross margins declined to 59% for the quarter, attributed to the transitional costs of supporting a partner-led delivery model. Full-year revenue was $64.5 million, up 2% year-over-year, with SaaS subscription revenue growing by 15%. The company maintained its guidance for 20% to 25% SaaS ARR growth in 2025, despite potential challenges in the NGO space due to federal budget cuts.

Sylogist Corporate Events

Sylogist Reports Strong Q3 2024 Results

Nov 7, 2024

Sylogist Ltd. reported impressive Q3 2024 results with a 15% increase in SaaS revenue and record partner-attached bookings at 47%. The company is experiencing strong growth in its SaaS business, supported by its partner community and a strong pipeline from its mission, education, and government sectors.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.