Update shared on 12 Nov 2025
Agilysys's analyst price target has been raised to $140. Analysts cite stronger-than-expected Q2 results and ongoing growth in subscription revenue as key drivers behind the upward revision.
Analyst Commentary
Recent price target increases for Agilysys reflect analyst confidence in the company's growth trajectory and execution. Analysts have updated models following Q2 results that exceeded expectations across several key metrics.
Bullish Takeaways
- Bullish analysts cite continued success in new bookings, both from net-new and existing customers, as evidence of sustained demand and strong sales execution.
- The company's competitive advantage is seen in its product platform and ongoing investments in brand awareness and expanded sales teams. These factors are supporting further market share gains.
- Agilysys displayed robust organic subscription revenue growth, especially in its POS and PMS segments. These segments saw 18% and 55% increases respectively, driving valuation targets higher.
- Upside Q2 performance included beats on revenue and EBITDA expectations. The company also reported record-setting backlog and cash generation, demonstrating effective operational leverage and execution.
Bearish Takeaways
- Despite broad-based sales strength, analysts express concerns about gross margin performance. Margins remain in the low 60% range due to lower utilization and increased investment in sales and service hires.
- There is caution around the impact of rapid hiring and changing revenue mix. These factors could put pressure on overall profitability in the near term.
- Some analysts note that consensus estimates for the coming fiscal year could be challenging if subscription and total revenue growth moderates from current elevated levels.
What's in the News
- The company raised its fiscal 2026 earnings guidance, with total revenue expected between $315 million and $318 million. Subscription revenue growth is projected at 29% year-over-year (Key Developments).
- The Saskatchewan Indian Gaming Authority (SIGA) has selected Agilysys InfoGenesis POS and Eatec solutions to modernize food and beverage operations across seven casino properties. This will unify systems and enable data-driven management (Key Developments).
Valuation Changes
- Consensus Analyst Price Target remains unchanged at $140, reflecting continued analyst confidence.
- The discount rate has risen slightly to 8.47%, up from 8.44% previously.
- Revenue growth is stable at 14.25% year-over-year.
- Net profit margin has improved modestly to 13.94% from 13.71% prior.
- Future P/E has declined to 80.25x from 84.49x, indicating a slightly more attractive valuation based on forward earnings.
Disclaimer
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