In a report released yesterday, Andrew Sherman from TD Cowen maintained a Hold rating on Elastic, with a price target of $85.00.
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Andrew Sherman has given his Hold rating due to a combination of factors influencing Elastic’s current market position. The recent performance of Elastic, particularly in the Cloud segment, has been mixed, with a notable miss in the last quarter after a streak of seven quarters of meeting expectations. This, combined with a conservative guidance from the new CFO, suggests a cautious outlook.
Additionally, competitive pressures from OpenSearch and challenges in channel strategy have been highlighted by partners, indicating potential headwinds. While there is some optimism with improved pipeline outlooks, concerns about AI risks to the Search business and the lack of visibility in Cloud revenue growth contribute to the Hold rating. The pricing adjustments and partner feedback further underscore the uncertainties that Elastic faces in maintaining its growth trajectory.
In another report released yesterday, Bank of America Securities also reiterated a Hold rating on the stock with a $96.00 price target.