Analyst Shrenik Kothari of Robert W. Baird maintained a Buy rating on Elastic, retaining the price target of $130.00.
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Shrenik Kothari has given his Buy rating due to a combination of factors that highlight Elastic’s strategic alignment and potential for long-term value creation. The recent performance-based equity award for CEO Ash Kulkarni, valued at approximately $29.3 million, is a key factor. This award is tied to ambitious share price targets and total shareholder return (TSR) hurdles, demonstrating a strong commitment to aligning CEO compensation with shareholder outcomes.
Furthermore, the award’s structure, which includes multiple service vesting conditions over three to five years, underscores the board’s confidence in Kulkarni’s long-term execution capabilities. The move also signals a shift towards higher performance incentives, with an increased proportion of performance stock units (PSUs) in executive compensation. This strategic alignment and focus on performance metrics such as revenue, margin, and cloud growth are pivotal in supporting the Buy rating, as they indicate a robust framework for sustained growth and executive retention through critical phases of the company’s development.
According to TipRanks, Kothari is a 5-star analyst with an average return of 25.3% and a 70.63% success rate. Kothari covers the Technology sector, focusing on stocks such as Tenable Holdings, Elastic, and Check Point.
In another report released on October 13, Truist Financial also reiterated a Buy rating on the stock with a $140.00 price target.