Agilysys (NASDAQ:AGYS) Shares Gap Down Following Weak Earnings

Agilysys, Inc. (NASDAQ:AGYS)’s share price gapped down prior to trading on Tuesday following a weaker than expected earnings announcement. The stock had previously closed at $113.55, but opened at $95.71. Agilysys shares last traded at $89.3750, with a volume of 294,510 shares changing hands.

The software maker reported $0.42 EPS for the quarter, missing the consensus estimate of $0.46 by ($0.04). The business had revenue of $80.39 million during the quarter, compared to analysts’ expectations of $79.07 million. Agilysys had a net margin of 8.12% and a return on equity of 11.22%. Agilysys’s revenue for the quarter was up 15.6% compared to the same quarter last year. During the same period in the previous year, the company posted $0.38 earnings per share.

Key Agilysys News

Here are the key news stories impacting Agilysys this week:

• Positive Sentiment: Analyst support: Needham & Company reiterated a “buy” rating and set a $140 price target (cited as ~23% upside vs. a referenced price), which can provide investor confidence and buying interest. Needham Reaffirms Buy, $140 PT
• Positive Sentiment: Top-line strength: Agilysys reported its 16th consecutive record revenue quarter — $80.4M, up ~15.6% year-over-year — showing recurring revenue growth that supports longer-term subscription value. Business Wire: 16th Consecutive Record Revenue Quarter
• Neutral Sentiment: Full disclosure/transcript: The company published its Q3 earnings materials and the earnings-call transcript is available for investors to review management’s tone and detail on recurring bookings and churn. (Useful for deciding whether the guidance change is structural or temporary.) Seeking Alpha: Q3 Earnings Call Transcript
• Neutral Sentiment: Deeper metrics analysis: Analyst write-ups (Zacks) compare key metrics vs. estimates and prior-year results — useful for parsing margin trends, recurring vs. professional-services mix, and cash flow. Zacks: What Key Metrics Have to Say
• Negative Sentiment: EPS miss: Non-GAAP EPS came in at $0.42 vs. consensus $0.46, which disappointed investors despite revenue strength — a direct negative for near-term sentiment. Zacks: AGYS Misses Q3 EPS
• Negative Sentiment: Guidance/booking concern: Market coverage highlighted that the company’s outlook/comments imply a slowdown in subscription sales growth — this guidance signal is the main catalyst for today’s downward move as subscription momentum drives the stock’s valuation. MarketWatch: Outlook Implies Subscription Slowdown
• Negative Sentiment: Market reaction: Multiple outlets reported the post-earnings share drop after the EPS miss and guidance concerns — reinforcing negative momentum and possible short-term selling pressure. Benzinga: Stock Falls After Q3 Earnings Miss

Analysts Set New Price Targets

A number of research analysts have issued reports on the company. Weiss Ratings reissued a “hold (c)” rating on shares of Agilysys in a report on Wednesday, January 21st. Zacks Research downgraded shares of Agilysys from a “strong-buy” rating to a “hold” rating in a report on Monday, December 29th. Needham & Company LLC restated a “buy” rating and set a $140.00 price target on shares of Agilysys in a research report on Tuesday. BTIG Research started coverage on shares of Agilysys in a research report on Tuesday, December 16th. They issued a “neutral” rating for the company. Finally, Oppenheimer increased their target price on shares of Agilysys from $130.00 to $140.00 and gave the stock an “outperform” rating in a research note on Thursday, December 4th. Four research analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company’s stock. Based on data from MarketBeat, the company currently has an average rating of “Moderate Buy” and a consensus target price of $145.40.

Insider Transactions at Agilysys

In related news, insider Sethuram Shivashankar sold 497 shares of Agilysys stock in a transaction dated Monday, November 3rd. The stock was sold at an average price of $124.64, for a total value of $61,946.08. Following the sale, the insider directly owned 24,031 shares in the company, valued at approximately $2,995,223.84. The trade was a 2.03% decrease in their position. The transaction was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, Director Donald A. Colvin sold 6,000 shares of the firm’s stock in a transaction that occurred on Friday, November 21st. The shares were sold at an average price of $123.28, for a total value of $739,680.00. Following the completion of the transaction, the director owned 24,592 shares in the company, valued at approximately $3,031,701.76. This trade represents a 19.61% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 9,576 shares of company stock worth $1,189,070 in the last three months. 8.60% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Agilysys

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. William Blair Investment Management LLC purchased a new position in shares of Agilysys during the second quarter worth $58,993,000. Wellington Management Group LLP boosted its holdings in Agilysys by 75.9% during the 3rd quarter. Wellington Management Group LLP now owns 690,498 shares of the software maker’s stock valued at $72,675,000 after acquiring an additional 297,846 shares during the period. Goldman Sachs Group Inc. boosted its holdings in Agilysys by 125.0% during the 1st quarter. Goldman Sachs Group Inc. now owns 331,953 shares of the software maker’s stock valued at $24,080,000 after acquiring an additional 184,402 shares during the period. American Century Companies Inc. grew its position in Agilysys by 38.7% in the 2nd quarter. American Century Companies Inc. now owns 627,660 shares of the software maker’s stock valued at $71,955,000 after acquiring an additional 175,137 shares in the last quarter. Finally, Invesco Ltd. increased its stake in Agilysys by 28.1% during the second quarter. Invesco Ltd. now owns 545,386 shares of the software maker’s stock worth $62,523,000 after purchasing an additional 119,736 shares during the period. Institutional investors and hedge funds own 88.00% of the company’s stock.

Agilysys Stock Down 20.9%

The company’s 50-day moving average price is $119.89 and its 200-day moving average price is $115.43. The firm has a market cap of $2.52 billion, a price-to-earnings ratio of 104.59 and a beta of 0.43.

About Agilysys

Agilysys, Inc is a publicly traded technology company (NASDAQ: AGYS) that specializes in providing software and services to the hospitality industry. The company’s solutions span property management, point-of-sale, inventory and procurement, workforce management, analytics and mobile guest engagement. These offerings are designed to streamline hotel and resort operations, enhance guest experiences and improve financial performance for clients across the lodging, gaming, cruise, senior living and higher-education markets.

Agilysys delivers its portfolio through both cloud-based and on-premises deployments, enabling hoteliers and hospitality operators to select the infrastructure model that best aligns with their operational requirements and IT strategies.