Dynatrace Receives Buy Rating Amid Strong Q4 Results and Positive Revenue Trends

In a report released yesterday, Gray Powell from BTIG reiterated a Buy rating on Dynatrace (DT – Research Report), with a price target of $57.00.

Gray Powell has given his Buy rating due to a combination of factors that suggest the strengths of Dynatrace are overshadowing its weaknesses. The company reported fiscal fourth-quarter results that exceeded expectations, with annual recurring revenue (ARR) growth outpacing estimates. Despite the initial guidance for the next fiscal year being somewhat below the consensus, it aligns with market expectations, indicating a conservative but realistic outlook. The report also highlights a notable improvement from the previous quarter, suggesting a positive trend in revenue addition which could reassure investors looking for stability.
Moreover, Dynatrace demonstrated strong large deal activity, with a significant contract expansion and numerous high-value deals. The adoption rate of the company’s new Dynamic Pricing Strategy (DPS) among customers is growing rapidly, which bodes well for future net revenue retention. The recent strategic changes in the go-to-market approach, though contributing to conservative guidance, are expected to yield improved performance throughout the fiscal year. This, combined with the evidence of stabilization from the fourth-quarter performance, underpins Powell’s confidence in reiterating a Buy rating, albeit with a reduced price target reflecting a more conservative valuation multiple.

In another report released today, Robert W. Baird also maintained a Buy rating on the stock with a $62.00 price target.

DT’s price has also changed slightly for the past six months – from $50.960 to $47.750, which is a -6.30% drop .

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Dynatrace (DT) Company Description:

Dynatrace, Inc. offers software intelligence platform, purpose-built for the enterprise cloud. The firm’s platform utilizes artificial intelligence at its core and advanced automation to provide answers, not just data, about the performance of applications, the underlying hybrid cloud infrastructure, and the experience of the customers’ users. It specializes in cloud ecosystem integration, incident and alert management integration, DevOps CI/CD integration, user experience and business intelligence insights. The company was founded in 2014 and is headquartered in Waltham, MA.