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    How Technology One’s Heavy R&D and UK, Education Push Will Impact Technology One (ASX:TNE) Investors

    Simply Wall St·12/19/2025 12:18:10
    語音播報
    • Recently, Technology One highlighted its practice of reinvesting around a quarter of its revenue into research and development to strengthen its enterprise software for government, education, and corporate customers, while targeting expansion in large markets such as the U.K. and higher education.
    • This emphasis on heavy R&D spending and entry into sizeable new sectors has reinforced perceptions that the company is deliberately building long-term product relevance and growth options.
    • Next, we’ll examine how Technology One’s sustained 20–25% R&D investment and push into larger markets may reshape its existing investment narrative.

    Find companies with promising cash flow potential yet trading below their fair value.

    Technology One Investment Narrative Recap

    To own Technology One, you need to believe its heavy, ongoing R&D spend will keep its software essential to public sector and education customers while supporting expansion into larger markets like the U.K. The latest update on reinvesting around a quarter of revenue into product development supports this longer term thesis, but does not materially change the near term picture where the main catalyst remains execution in new markets and the key risk is whether high expectations embedded in the share price prove too demanding.

    Among recent announcements, the November 2025 full year result stands out in this context, with revenue rising to A$598.5 million and net income to A$137.7 million, alongside higher dividends and a special dividend. For investors, this pairing of strong current profitability with ongoing R&D intensity underlines why the company is seen as building a long runway for growth, but it also sharpens the question of how much future success is already priced in.

    But while that growth story is appealing, investors should still be aware of how sensitive such a highly rated share can be if...

    Read the full narrative on Technology One (it's free!)

    Technology One’s narrative projects A$841.0 million in revenue and A$224.2 million in earnings by 2028.

    Uncover how Technology One's forecasts yield a A$34.87 fair value, a 23% upside to its current price.

    Exploring Other Perspectives

    ASX:TNE 1-Year Stock Price Chart
    ASX:TNE 1-Year Stock Price Chart

    Eight fair value estimates from the Simply Wall St Community span roughly A$18.39 to A$37.03, showing how far apart individual views on Technology One can be. You are weighing these diverse opinions against a company that keeps reinvesting 20 to 25 percent of revenue into R&D to protect its competitive edge and future earnings power, which could matter a lot for how the story plays out over time.

    Explore 8 other fair value estimates on Technology One - why the stock might be worth 35% less than the current price!

    Build Your Own Technology One Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

    • A great starting point for your Technology One research is our analysis highlighting 2 key rewards that could impact your investment decision.
    • Our free Technology One research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Technology One's overall financial health at a glance.

    Searching For A Fresh Perspective?

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.