Sylogist is ready for prime time, Ventum says

Sylogist’s recent statewide contract may have flown under the market’s radar, but Ventum analyst Amr Ezzat says the $15-million deal was clearly visible to anyone who took the time to review the public RFP.

Ezzat is maintaining his Buy rating and C$13.00 price target on Sylogist (Sylogist Stock Quote, Chart, News, Analysts, Financials TSXV:SYZ).

In a May 1 update, Ezzat said a recent Sylogist marketing meeting reinforced his view that the market continues to undervalue Sylogist’s strategic shift.

“CEO Bill Wood didn’t try to impress — he didn’t need to,” Ezzat said. “His tone was measured, his framing precise, and his answers concise, grounded, and insightful. There was no slideware, no hand-waving, no attempt to explain away the past. Just a direct articulation of a structurally different business: delivery unshackled by the partner ecosystem, bookings driven by targeted competitive displacement, and a platform architecture built to scale.”

Ezzat said that what many see as macroeconomic headwinds- political noise, budget tightening, and education reform- are immediate tailwinds for Sylogist, whose customers are primarily state and local governments. He said these jurisdictions are gaining influence and funding, which is already benefiting Sylogist.

Founded in 1993 and based in Calgary, Sylogist provides ERP solutions to public sector clients, including K–12 school boards, state agencies, nonprofits, and international NGOs.

Ezzat pushed back against concerns that U.S. federal budget cuts could hurt Sylogist. “Sylogist doesn’t deal with federal departments — its customers are local governments, school districts, and state agencies,” he said. “Any decentralization of education and public sector IT from Washington to the states only widens SYZ’s addressable market. In a world where states gain more control (and funding discretion), Sylogist’s positioning improves, not deteriorates.”

With Microsoft sunsetting its Great Plains ERP system, many municipalities are being forced to modernize. Ezzat said Sylogist Gov, built on Microsoft’s Business Central and fully integrated within the Microsoft ecosystem, is well-positioned to capture this opportunity.

Meanwhile, the education and nonprofit sectors remain steady sources of demand.

On the company’s recently announced Texas VSS win, Ezzat said the market overlooked its size.

“That might help explain why the market shrugged,” he said. “But for anyone willing to spend 30 seconds searching the public RFP, the number is right there: US$10.6M (or ~$15.0M), covering full implementation plus two optional two-year renewals through 2030. This is not a small module or pilot test. It’s a full-scale, production-grade, mission-critical platform being deployed statewide across 150+ agencies, with visibility into >2M court cases annually and over 500K automated notifications.”

Ezzat thinks Sylogist will generate $17.5-million in Adjusted EBITDA on $69.9-million in revenue in fiscal 2025. He expects those numbers to improve to $23.6-million in Adjusted EBITDA on $79.4-million in revenue in fiscal 2026.

He said Sylogist is undergoing a meaningful transformation under new leadership, shedding its former “Steady Eddie” persona and pursuing more aggressive growth. “The change in management and board of directors was a much-needed stepping stone to revitalize a stagnant business model,” he said, adding that early signs of sales momentum are now visible.

Ezzat acknowledged that the company’s margins have compressed as it invests in scaling operations, but he believes they are near the bottom. He also highlighted favourable industry trends: PowerSchool’s and Blackbaud’s pricing strategies, he said, are pushing discontented customers toward Sylogist. And the company’s 2022 decision to reduce its dividend freed up $11-million annually for growth-focused reinvestment.

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