Shares of Dynatrace, Inc. (DT) have declined 20.3% so far this year. The company provides software intelligence to enhance digital transformation and simplify cloud complexity.
However, DT recently reported better-than-estimated performance for the third quarter on both its top-line and bottom-line fronts.
Revenue increased 31.6% year-over-year to $240.7 million, outperforming estimates by $6.3 million. Earnings per share at $0.18 came in ahead of expectations by $0.02.
Notably, while Subscription revenue jumped 33% year-over-year to $226 million, annual recurring revenue (ARR) increased 29% year-over-year to $930 million.
With these developments in mind, let us take a look at the changes in Dynatrace’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, Dynatrace’s top risk category is Finance & Corporate, contributing 25 (compared to a sector average of 16 risk factors) of the total 60 risks identified for the stock.
In its recent report, the company has added one key risk factor under the Finance & Corporate risk category.
Dynatrace noted that its growth hinges on enhancing its existing products and bringing new products to markets on a timely basis. The company plans to fulfill this objective both through internal development and acquisitions. Consequently, it expects to consider a range of potential acquisitions as part of its business strategy.
The risk remains that acquisitions and other strategic activities could lead to operating difficulties and harm Dynatrace’s business.
Hedge Fund Activity
According to TipRanks data, the Wall Street’s top hedge funds have decreased holdings in Dynatrace by 162.6 thousand shares in the last quarter, indicating a negative hedge fund confidence signal in the stock based on activities of 11 hedge funds.
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