- Following a solid quarter, we remain buy-rated and recommend investors buy shares here. Dynatrace beat revenues, EPS, and ARR handily and provided guidance that was ahead of estimates.
- Dynatrace continues to add customers rapidly, and upsells remain strong. Digital Transformation (DX) drives growth for the company as it continues to grow profitably, a rarity in the tech sector.
- DX is increasing the complexity of IT systems, and Dynatrace’s automation and AI tools help enterprises manage this complexity.
- We expect DT to do well with large enterprises and demanding environments in the observability market, while we expect DDOG/SPLK/ESTC to do well in less challenging environments.
- Investors should buy shares in Dynatrace, as the stock is reasonably priced with a robust and capable platform. We expect it to grow 25%+ for many years while remaining profitable.
For further details see:
Dynatrace - Another Solid Quarter; Buy The Weakness