Needham & Company maintained a Buy rating on Tyler Tech (NYSE: TYL), and cut the price target to $160.00 (from $200.00), following a company's 4Q conference call. 4Q bookings were light compared to recent reported results as reported bookings were flat Y/Y while license revenues only grew organically 1% Y/Y in the quarter. However, the company reported its highest level of subscription bookings ever, coming in at $32.4mm, ahead of the $31mm in bookings during 4Q14. Needham reduced revenue estimates roughly $31mm to reflect the lower New World revenues, and lower organic growth.

Analyst Scott Berg commented, "Tyler's conference call highlighted a demand environment that remains robust overall, but we believe the additional quarterly color indicated that 4Q new sales were nominally lighter than recent periods. However, we do not believe the 4Q bookings and backlog results (which we detail below) represent a new normal, but more reflect the occasional lumpiness in deal cycle that can move deals between quarters. While the company's accelerated $12mm in 2016 R&D investment will compress operating margins by roughly 200bps over estimated 2016 levels, we like the strategy given TYL's recent product strategy, which has clearly separated itself from many of the competitive vendors."

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Shares of Tyler Tech closed at $124.19 yesterday.