Dynatrace (DT) AI Stock Analysis

• Market Cap: $16.23B
• Dividend Yield: N/A
• Average Volume (3M): 2.75M
• Price to Earnings (P/E): 33.8
• Beta (1Y): 1.16
• Revenue Growth: 18.75%
• EPS Growth: 208.06%
• Country: US
• Employees: 4,700
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Application
• EPS (TTM): 0.33
• Shares Outstanding: 299,666,800
• 10 Day Avg. Volume: 2,665,544
• 30 Day Avg. Volume: 2,747,867
• PEG Ratio: 1.01
• Price to Book (P/B): 7.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 36.51
• Enterprise Value/Market Cap: 0.72
• Enterprise Value/Revenue: 1.83
• Enterprise Value/Gross Profit: 8.48
• Enterprise Value/Ebitda: 13.24
• 1Y Price Target: $63.70
• Price Target Upside: 18.25% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 23

• Rating: 79 Outperform
• Price Target: $61.00 ▲(13.24%Upside)

Dynatrace's overall score is driven by its strong financial performance, positive earnings call insights, and robust technical indicators. The high valuation reflects market optimism but may pose a risk if growth expectations aren't met. While technical indicators suggest bullish momentum, caution is advised due to near-overbought signals.

Positive Factors

Financial Performance

Dynatrace reported strong financial results with revenue and profitability exceeding expectations, indicating a solid performance in the recent quarter.

Growth Potential

The company's initial guidance for the future fiscal year is slightly better than prior estimates, suggesting potential for continued growth.

Product Adoption

Dynatrace highlighted solid adoption of its logging solution as customers look to consolidate their logging workflows onto broader observability platforms.

Negative Factors

Market Transition

The goal of reaching $100MM in ARR from Security solutions is likely pushed out to FY27 due to the transition toward a consumption-based model.

Dynatrace Business Overview & Revenue Model

Company Description

Dynatrace, Inc. provides a software intelligence platform for dynamic multi-cloud environments. It operates Dynatrace, a software intelligence platform, which provides application and microservices monitoring, runtime application security, infrastructure monitoring, digital experience monitoring, business analytics, and cloud automation. Its platform allows its customers to modernize and automate IT operations, develop and release software, and enhance user experiences. The company also offers implementation, consulting, and training services. Dynatrace, Inc. markets its products through a combination of direct sales team and a network of partners, including resellers, system integrators, and managed service providers. It serves customers in various industries comprising banking, insurance, retail, manufacturing, travel, and software. The company operates in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. Dynatrace, Inc. was founded in 2005 and is headquartered in Waltham, Massachusetts.

How the Company Makes Money

Dynatrace makes money primarily through a subscription-based revenue model. Customers pay for access to its software intelligence platform, which is offered as a SaaS (Software as a Service) solution. The company generates revenue by charging fees based on the number of hosts or the amount of data monitored, allowing for scalability and flexibility in pricing. Key revenue streams include sales of its application performance management and infrastructure monitoring solutions, as well as related professional services. Partnerships with major cloud providers like Amazon Web Services, Microsoft Azure, and Google Cloud also play a significant role in expanding Dynatrace's market reach and driving revenue growth. Additionally, the company's focus on AI and automation tools helps differentiate its offerings and attract a diverse range of enterprise customers seeking to optimize their digital transformation initiatives.

Dynatrace Financial Statement Overview

Summary

Dynatrace exhibits a strong financial position with consistent revenue and profit growth, solid profit margins, and efficient cash flow management. The low leverage enhances financial stability, while the impressive return on equity and cash conversion ratios highlight effective management practices. The company is well-positioned for future growth with a robust financial foundation.

Income Statement

Dynatrace has demonstrated strong revenue growth with a 18.73% increase from the previous year, indicative of its competitive position in the software application industry. The gross profit margin is robust at 81.15%, reflecting efficient cost management. Net profit margin has improved significantly to 28.47%, showcasing enhanced profitability. The EBIT margin of 10.56% and EBITDA margin of 10.56% indicate solid operational performance.

Balance Sheet

The company's balance sheet is stable with a strong equity base, evidenced by an equity ratio of 63.34%. The debt-to-equity ratio is low at 0.03, indicating minimal leverage and associated financial risk. Return on equity stands at 18.45%, suggesting effective utilization of equity to generate profits. Overall, the balance sheet reflects financial stability and low risk.

Cash Flow

Dynatrace's cash flow performance is impressive with an operating cash flow to net income ratio of 0.95, indicating efficient cash generation relative to net income. The free cash flow has grown by 23.19%, highlighting strong cash flow management. The free cash flow to net income ratio of 0.90 suggests the company effectively converts its earnings into free cash flow.

Breakdown
Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
1.70B	1.43B	1.16B	929.45M	703.51M
	Gross Profit
1.38B	1.16B	935.64M	756.57M	575.80M
	EBIT
179.43M	128.40M	92.81M	81.31M	91.90M
	EBITDA
179.43M	183.34M	147.42M	138.18M	153.02M
	Net Income Common Stockholders
483.68M	154.63M	107.96M	52.45M	75.71M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.11B	836.87M	555.35M	462.97M	324.96M
	Total Assets
4.14B	3.41B	2.77B	2.54B	2.26B
	Total Debt
75.36M	69.53M	75.17M	338.76M	439.61M
	Net Debt
-941.68M	-709.46M	-480.18M	-124.20M	114.64M
	Total Liabilities
1.52B	1.39B	1.16B	1.24B	1.14B
	Stockholders Equity
2.62B	2.02B	1.60B	1.30B	1.11B
Cash Flow		Free Cash Flow
433.31M	351.65M	333.35M	233.22M	206.36M
	Operating Cash Flow
459.42M	378.11M	354.88M	250.92M	220.44M
	Investing Cash Flow
-69.31M	-193.05M	-21.54M	-30.89M	-13.88M
	Financing Cash Flow
-151.63M	50.66M	-232.34M	-80.66M	-97.80M

Dynatrace Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 53.87
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DT, the sentiment is Positive. The current price of 53.87 is below the 20-day moving average (MA) of 53.90, above the 50-day MA of 49.08, and above the 200-day MA of 52.76, indicating a bullish trend. The MACD of 1.23 indicates Positive momentum. The RSI at 61.14 is Neutral, neither overbought nor oversold. The STOCH value of 44.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DT.

Dynatrace Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BSY	81 Outperform	$14.55B	60.97	25.20%	0.58%	10.71%	-27.64%
DT	79 Outperform	$16.23B	33.76	20.86%	―	18.75%	208.06%
MNDY	78 Outperform	$15.64B	305.41	5.39%	―	32.25%	156.94%
DOCU	76 Outperform	$15.57B	14.41	70.20%	―	7.85%	935.80%
U	73 Outperform	$10.33B	―	-14.15%	―	-16.74%	49.75%
GWRE	71 Outperform	$21.20B	636.74	2.61%	―	18.61%	―
Sector *	62 Neutral	$11.93B	10.60	-7.51%	3.00%	7.40%	-8.09%

Dynatrace Corporate Events

Dynatrace Appoints Steve McMahon as Chief Customer Officer

On April 22, 2025, Dynatrace announced the appointment of Steve McMahon as the new Chief Customer Officer, effective May 12, 2025, succeeding Matthias Dollentz-Scharer, who will retire after over a decade with the company. McMahon, with extensive experience in customer success roles at Zscaler, CrowdStrike, and Splunk, is expected to enhance Dynatrace’s customer value and contribute to its long-term growth, building on the strong foundation established by Dollentz-Scharer.