Fund Manager Summary
The fund managers believe that the outlook for TechnologyOne Ltd remains positive, particularly given its recent performance and strategic direction. In their opinion, the company’s shift to SaaS (software as a service) has effectively driven accelerating revenue growth, positioning it well in the market. With a notable increase in share price to approximately $17.78, the fund managers highlight the significance of the company’s strong guidance for FY24 and its ambitious goal to double in size every 5 years. This growth potential, coupled with its successful navigation of the transition from legacy revenue models, presents a compelling opportunity for investors.
Source: Trading View
Commentary From The Managers
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Pendal Group
24 Nov 2025
$30.04
Summary
- Pendal Group updates their investment thesis on TechnologyOne Ltd (TNE), noting a solid FY25 result.
- Annual Recurring Revenue (ARR) grew 18%, with strategic upfront investments maintaining margins.
- TechnologyOne achieved 19% PBT growth despite these investments.
- Free cash flow exceeded expectations, allowing for a dividend payout ratio increase to 65-75%.
- The company successfully offset stock-based compensation.
- Pendal Group views the management team as effectively balancing business operations to benefit all stakeholders.
- Market concerns regarding a slowdown in Asia Pacific ARR growth are seen as misplaced; the company faced supply constraints in FY25.
- New AI-enabled products and initiatives are expected to drive sustained strong growth.
- Pendal Group anticipates that consistent execution will be rewarded by the market in the long term.
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Commentary From The Managers
Pendal Group
24 Nov 2025
$30.04
- Pendal Group updates their investment thesis on TechnologyOne Ltd (TNE), noting a solid FY25 result.
- Annual Recurring Revenue (ARR) grew 18%, with strategic upfront investments maintaining margins.
- TechnologyOne achieved 19% PBT growth despite these investments.
- Free cash flow exceeded expectations, allowing for a dividend payout ratio increase to 65-75%.
- The company successfully offset stock-based compensation.
- Pendal Group views the management team as effectively balancing business operations to benefit all stakeholders.
- Market concerns regarding a slowdown in Asia Pacific ARR growth are seen as misplaced; the company faced supply constraints in FY25.
- New AI-enabled products and initiatives are expected to drive sustained strong growth.
- Pendal Group anticipates that consistent execution will be rewarded by the market in the long term.
Summary
Ten Cap
31 Oct 2025
$36.90
- Ten Cap has updated their investment thesis on TechnologyOne Ltd (TNE).
- They have added to their position in TNE.
- TNE is recognized as a leading enterprise software provider.
- The company boasts a strong recurring revenue base.
- TNE has demonstrated consistent earnings growth.
- The recent share price pullback was seen as an attractive entry point.
- Ten Cap views TNE as a high-quality compounder.
Summary
Alphinity Investment Management
10 Oct 2025
$39.77
- Alphinity Investment Management expresses a positive outlook on TechnologyOne, a developer of resource planning software.
- TechnologyOne targets sectors such as councils, schools, universities, hospitals, and government agencies.
- The company is focusing on growth opportunities in the United Kingdom, aiming to capture market share from Oracle and Workday.
- Recently, TechnologyOne entered the S&P/ASX 50, marking a significant milestone.
- They unveiled a ChatGPT-style product to enhance their software capabilities.
- According to Martin, the market may be undervaluing the company's potential for consistent mid-teens growth.
- This growth can be achieved without taking material risks.
Summary
Alphinity Investment Management
14 Aug 2025
$38.24
- Alphinity Investment Management continues to hold TechnologyOne due to its underappreciated status in the market.
- Despite a strong run, the company remains less understood compared to other large caps.
- TechnologyOne offers a leading enterprise resource planning solution specifically for the government and education sectors.
- It holds a strong position in defensive end-markets with a long runway of profitable growth.
- There is particular enthusiasm for TechnologyOne’s substantial growth potential in the UK market.
- Recent meetings with local UK government bodies and industry experts have validated significant commercial opportunities ahead.
Summary
Montgomery Investment Management
21 July 2025
$40.10
- Montgomery Investment Management recognizes TechnologyOne’s transformation under a focused Software as a Service (SaaS) strategy, enhancing its earnings growth trajectory.
- The company has established a strong presence in the UK since 2006, with significant growth in the education and local government sectors.
- Accelerating Annual Recurring Revenue (ARR) growth is noted, supported by a favorable digital transformation backdrop.
- TechnologyOne’s UK operations are expected to maintain sustained momentum due to its disciplined approach and strategic focus.
- The acquisition of Scientia for £12 million in 2021 has sharpened its higher education offerings, particularly in timetabling and student management.
- The launch of the SaaS+ platform has streamlined value propositions for councils and universities, enhancing appeal to budget-conscious public sector clients.
- In the first half of 2025, UK ARR reached A$43 million, up 50% year-on-year, significantly outpacing group ARR growth of 21%.
- New sales ARR climbed 61% to A$4.3 million, reflecting strong traction in government verticals and education.
- TechnologyOne is capturing market share from legacy players like SAP and Oracle, driven by its competitive advantage and structural improvements.
- The integration of Scientia is challenging competitors in the higher education sector, while OneCouncil is eroding shares of Civica and Capita in local government.
- TechnologyOne’s innovative SaaS+ model simplifies deployment, contrasting with the complexity of offerings from larger competitors.
- Montgomery Investment Management continues to hold because of the expected sustained growth driven by a strong competitive advantage and a large total addressable market.
- The company aims to double revenue every five years, supported by deeper market penetration and new government contracts.
Summary
Alliance Bernstein
30 June 2025
$41.01
- TechnologyOne is an Australian enterprise software company focused on software-as-a-service solutions.
- The company specializes in serving government and large enterprises.
- Recent half-year results surpassed market expectations, contributing positively to performance.
- TechnologyOne shows substantial growth in annual recurring revenues.
- This growth enhances investor confidence in its long-term business model.
- Alliance Bernstein continues to hold its position in TechnologyOne due to these positive indicators.
Summary
Lakehouse Capital
30 June 2025
$41.01
- Lakehouse Capital sold their investment in TechnologyOne due to stretched valuations.
- The business performed well and the investment thesis largely played out as expected.
- Reluctance to exit high-quality businesses on valuation grounds alone.
- Capital could be better deployed in other opportunities.
- TechnologyOne remains a well-run, resilient business.
- Lakehouse Capital will continue to follow TechnologyOne's progress relative to its share price.
Summary
LHC Capital
30 June 2025
$41.01
- Technology One achieved A$500 million in annual recurring revenue (ARR) 18 months ahead of schedule.
- Shares increased by 48% during the quarter.
- LHC Capital continues to hold due to Technology One's sound execution of its business plan.
- Market-leading net revenue retention rates (NRR) and low customer churn rates.
- Record revenues, profits, and SaaS fees for the sixteenth consecutive year.
- Full year profit growth upgraded to 13-17%.
- New target of exceeding A$1,000m in ARR by FY30.
- First Federal Government department customer signed.
- Significant growth in the UK business with ARR up 50% year-on-year.
- SaaS Plus offering disrupts traditional ERP pricing strategies.
- Customers adopting SaaS Plus deliver 40% more ARR compared to traditional SaaS products.
- NRR expanded to 118% due to SaaS Plus adoption.
- Islington Council contract win validates tailored strategy for UK local government.
- All six verticals in Australia recorded double-digit ARR increases.
- Market share below 15%, indicating significant growth potential.
- Technology One continues to compound at a high rate supported by a recurring revenue base.
- Expected to double every five years as per updated ARR guide.
- Beneficiary of the AI revolution, anticipating productivity gains and improved profit margins.
- LHC Capital believes this positions for attractive returns over the medium term.
Summary
Vinva Investment Management
30 June 2025
$41.01
- TechnologyOne (TNE) outperformed with a robust 1H25 result.
- Total revenue reached $291m, a 19% YoY increase.
- Annual recurring revenue (ARR) of $511m, reflecting a 21% YoY growth.
- Growth driven by accelerating UK expansion and SaaS+ adoption.
- PBT guidance for FY25 is 13–16%, noted as conservative.
- Vinva Investment Management continues to hold an overweight position in TNE.
- The investment thesis is supported by a mix of behavioural and quality signals.
Summary
Yarra Capital Management
30 June 2025
$41.01
- Yarra Capital Management notes TechnologyOne Ltd (TNE) has shown strong revenue and earnings growth.
- The company has made encouraging progress in the UK market.
- Despite the positive momentum, high valuation multiples (50.8-times EV/EBITDA and 83.8-times FY26 P/E) are seen as prohibitive.
- Yarra Capital Management continues to hold an underweight position due to better relative opportunities in the high growth technology sector.
Summary
Glennon Small Companies
31 May 2025
$41.10
- Technology One was the standout performer for the month.
- Strong rally following the release of its half-year results for the period ended March 2025.
- Reported robust revenue growth, driven by its Software-as-a-Service (SaaS) offering.
- SaaS has become the cornerstone of its recurring revenue model.
- Strong contract wins and increased customer retention.
- Operational leverage contributed to margin expansion and positive investor sentiment.
- Results reinforced confidence in Technology One's growth strategy.
- Maintains its leadership position in enterprise software across the public sector and higher education markets.
- Glennon Small Companies continues to hold Technology One due to its strong fundamentals and growth potential.
Summary
Wilson Asset Management
31 May 2025
$41.10
- TechnologyOne Ltd is Australia’s largest enterprise Software-as-a-Service (SaaS) company.
- Share price reached an all-time high of $41.35 in May.
- Strong results released on 20 May for the half year ended 31 March 2025 exceeded investor expectations.
- Reported a 19% increase in total revenue to $291.3 million.
- Net profit after tax rose by 31% to $63 million.
- Annual recurring revenue (ARR) grew by 21% to $511.1 million.
- Exceptional growth in the UK market with ARR increasing by 50% to $43.1 million.
- Strong financial results and upgraded full-year profit guidance boosted investor confidence.
- Wilson Asset Management continues to hold due to these positive developments.
Summary
Yarra Capital Management
31 May 2025
$41.10
- TechnologyOne (TNE) has recently shown strong revenue and earnings growth.
- Yarra Capital Management notes encouraging progress in the US and UK markets.
- Despite the positive business momentum, valuation metrics such as 52-times EV/EBITDA and 97-times P/E are deemed prohibitive.
- Yarra Capital Management continues to hold an underweight position due to these valuation concerns.
- Better relative opportunities are identified in the high growth technology space.
Summary
Ten Cap
31 May 2025
$41.10
- Technology One (TNE) reached new highs after beating both revenue and EPS estimates in its half-year results.
- Its resilient SaaS model and deep domestic exposure continue to drive robust recurring revenue.
- Ten Cap continues to hold because of the strong performance and growth potential.
- Investment thesis remains positive due to consistent revenue growth and market position.
Summary
Selector Funds Management
31 Dec 2024
$31.31
- Selector Funds Management continues to hold TechnologyOne due to its position as a global provider of Software-as-a-Service (SaaS) Enterprise Resource Planning (ERP).
- TechnologyOne serves six verticals: Education, Government, Local Government, Health, Financial Services, and Asset & Project Intensive industries.
- The company reported a strong FY 2024 result with revenue up 18% to $507m and net profit after tax of $118m, a 15% increase year-on-year.
- Annual recurring revenue (ARR) grew 20% to $470m, driven by new client wins and increased product uptake.
- The U.K. market showed significant growth, with new sales ARR increasing 70% to $8.7m.
- TechnologyOne has achieved continuous innovation, rewriting its codebase four times since 1987.
- Customers have reported savings of over 30% on total cost of ownership by transitioning to TechnologyOne’s SaaS offering.
- Net Revenue Retention (NRR) was 117%, indicating strong existing customer relationships.
- Customer churn remains low at 1.3%, below the forecasted 1.8%.
- TechnologyOne's strategic approach includes landing customers with core products and expanding engagement over time.
- The SaaS+ model addresses implementation costs, offering a complete service for a single annual fee.
- TechnologyOne aims for a 30-day ERP implementation by 2028, significantly reducing current timelines.
- The acquisition of CourseLoop enhances its OneEducation solution, providing a complete end-to-end solution for the student lifecycle.
- Investment in R&D increased 14% to $125m, representing 25% of revenue.
- Management has upgraded its medium-term target to surpass $500m ARR by the first half of FY25.
- A new long-term target aims for over $1b ARR by FY30.
- TechnologyOne has a market capitalisation of $10.1b.
Summary
LHC Capital
31 Dec 2024
$31.31
- Technology One demonstrated exceptional performance in 2024, achieving a total shareholder return of 105%.
- Financial results exceeded market expectations, with Annual Recurring Revenue (ARR) growth of 20% and a net profit before tax increase of 18%.
- The company continues to invest significantly in research and development, viewed as a core competitive advantage.
- Growth in the UK market is notable, with UK ARR increasing by 31% and several key customer acquisitions.
- The transition to a cloud-based ERP system has been successful, driving a significant revenue uplift.
- Customers utilizing cloud-based deployments are likely to purchase more modules, enhancing profit margins.
- The introduction of SaaS Plus is disrupting traditional ERP pricing models, bundling software and implementation costs into a single payment.
- Technology One's strong outlook for 2025 anticipates surpassing A$500m in ARR and aims for A$1,000m by 2030.
- Changes to the Long-Term Incentive (LTI) structure reflect confidence in future growth, with increased EPS growth targets for management.
- LHC Capital continues to hold because of the strong growth potential and the strategic advantages Technology One is establishing in the market.
Summary
Selector Funds Management
30 Nov 2024
$30.91
- TechnologyOne delivered a strong FY24 result with revenue increasing 17% to $515m (90% recurring).
- Net profit after tax reached $118m, up 15%.
- The company brought forward its $500m+ Annual Recurring Revenue (ARR) target by six months to HY25.
- Plans to continue doubling ARR every five years with a new long-term target of $1b+ ARR by FY30.
- Product innovation remains a core enabler for long-term growth, with R&D investment at 20%-25% of revenue.
- Vision to reduce implementation time of its core ERP solution from 140 days to 30 days by 2028.
- TechnologyOne has a market capitalisation of $9.8b.
Summary
Selector Funds Management
30 June 2024
$18.17
- TechnologyOne is a global provider of Software-as-a-Service (SaaS) Enterprise Resource Planning (ERP).
- Founded in 1987, it serves six verticals: Education, Government, Local Government, Health, Financial Services, and Asset & Project Intensive industries.
- Employs over 1,100 staff across six countries, including Australia, New Zealand, the U.K., and Malaysia.
- Reported a strong result in the first half of financial year 2024 with 21% growth in annual recurring revenue (ARR).
- Successfully transitioned to a SaaS model, with only a few remaining license fee customers.
- Continuous innovation with four rewrites of its codebase, allowing biannual releases of new products.
- Customers have reported savings of over 30% on total cost of ownership with SaaS offerings.
- Latest update, 24a, will introduce 440 new features across 16 products.
- Net Revenue Retention (NRR) was 117%, indicating strong customer relationships.
- Customer churn increased to 1.8% due to ending on-premise offerings.
- Strategic approach to customer engagement, starting with core products and expanding over time.
- SaaS+ addresses implementation costs, bundling software and implementation into a single annual fee.
- Management describes SaaS+ as a “game changer” for faster rollouts and reduced risk.
- Guidance for full year 2024: ARR growth of 15% to 20% and net profit before tax growth of 12% to 16%.
- Management expects to surpass $500m in ARR by financial year 2025.
- Aim for a 30-day ERP implementation by 2028, down from the current average of 300 days.
- TechnologyOne has a market capitalisation of $6b.
Summary
Monash Investors
31 May 2024
$17.78
- Technology One (ASX: TNE) has shown a +9% increase following its half year results.
- TNE specializes in commercial software for accounting and administration, serving corporates, universities, councils, and government departments.
- The company is experiencing accelerating revenue growth as it transitions from legacy revenue based on license fees to a SaaS (Software as a Service) model.
- Technology One provided strong guidance for FY24, indicating robust future performance.
- The firm expects to double in size every 5 years, reinforcing confidence in its growth trajectory.
- Monash Investors continues to hold Technology One due to its promising outlook and strategic transition.
Summary
Elston Asset Management
30 Sept 2023
$15.44
- Elston sold their investment in TechnologyOne due to its addition to the S&P/ASX 100 index.
- The decision was made as part of S&P’s March 2023 index rebalancing.
- Elston aims to remain true to their label as small cap managers.
- There is a mandated 12-month period to remove a holding after its inclusion in the S&P/ASX 100 index.
Summary
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ANALYST INSIGHT
Equity Research Analyst
"With accelerating revenue growth and a savvy shift to SaaS, the trajectory appears promising; TechnologyOne Ltd seems poised to double in size every five years, making it a compelling play for those seeking growth in the tech space."
Last Updated: 24 Nov 2025
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Frequently Asked Questions
Who is investing in TechnologyOne Ltd (ASX:TNE)?
Fund managers including Monash Investors, Yarra Capital Management, Elston Asset Management, LHC Capital, Ten Cap, Wilson Asset Management, Montgomery Investment Management, Lakehouse Capital, Selector Funds Management, Alliance Bernstein, Glennon Small Companies, Alphinity Investment Management, Vinva Investment Management and Pendal Group have invested in TechnologyOne Ltd (ASX:TNE).
Why do fund managers invest in TechnologyOne Ltd?
Fund managers invest in TechnologyOne Ltd due to its strong revenue growth and successful transition to a SaaS model, which enhances recurring revenue. The company's ability to provide essential software for various sectors, coupled with optimistic guidance for FY24, indicates a robust growth trajectory, positioning it to potentially double in size every five years.
What happened to TechnologyOne Ltd (ASX:TNE)?
Fund managers are investing in TechnologyOne Ltd due to its strong position in the enterprise resource planning sector for government and education, which is seen as a defensive market with significant growth potential. They highlight the company's underappreciated value, particularly in the UK where it aims to capture market share from established competitors like Oracle and Workday. Recent financial results indicate solid growth in annual recurring revenue and free cash flow, alongside a commitment to shareholder returns through increased dividends. Overall, fund managers believe TechnologyOne is well-positioned for sustained growth, supported by innovative AI products and consistent execution.