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Elastic
(NYSE:ESTC)
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Rating:79Outperform
Price Target:
$91.00
▲(14.83% Upside)
Action:Reiterated
Date:08/28/26
The score is driven primarily by improving financial quality (strong free cash flow, better balance sheet, solid revenue/margin profile) and a supportive earnings outlook with guided margin/FCF expansion and accelerating backlog. Technicals are constructive with an established uptrend. Valuation is a modest offset, appearing fair rather than meaningfully undervalued on the provided P/E and with no dividend yield support.
Positive Factors
Recurring subscription growth and expanding backlog
Recurring subscriptions and accelerating multi-year obligations provide visibility into future revenue. Strong CRPO and RPO growth, including a 43% increase in non-current RPO, supports durable demand and conversion potential over the next several quarters.
Negative Factors
Operating profitability remains inconsistent
The company has not yet demonstrated consistent GAAP operating profitability, so reported earnings quality remains less established than its cash generation. Positive net income may include non-operating effects, leaving execution and margin durability as ongoing risks.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring subscription growth and expanding backlog
Recurring subscriptions and accelerating multi-year obligations provide visibility into future revenue. Strong CRPO and RPO growth, including a 43% increase in non-current RPO, supports durable demand and conversion potential over the next several quarters.
Read all positive factors
Elastic Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across regions, revealing where Elastic is strongest and where growth or currency risks are concentrated; helps judge dependence on the U.S. versus international markets and the success of local cloud adoption and sales efforts.
Breaks down revenue across regions, revealing where Elastic is strongest and where growth or currency risks are concentrated; helps judge dependence on the U.S. versus international markets and the success of local cloud adoption and sales efforts.
Data provided by:
The Fly
The FlyElastic (ESTC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.36B
Dividend YieldN/A
Average Volume (3M)1.77M
Price to Earnings (P/E)22.4
Beta (1Y)1.58
Revenue Growth17.26%
EPS GrowthN/A
CountryUS
Employees4,019
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)3.54
Shares Outstanding103,951,630
10 Day Avg. Volume1,615,699
30 Day Avg. Volume1,768,687
Financial Highlights & Ratios
PEG Ratio-0.03
Price to Book (P/B)3.83
Price to Sales (P/S)2.81
P/FCF Ratio15.20
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$87.04Price Target Upside9.83% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering27
EPS Forecast (FY)3.24
Revenue Forecast (FY)$2.00B
Elastic Business Overview & Revenue Model
Company Description
Elastic N.V., a company specializing in search technologies, furnishes advanced solutions engineered to operate across public, private, and multi-cloud environments. Its flagship offering is the Elastic Stack, a comprehensive software suite design...
How the Company Makes Money
Elastic generates the vast majority of its revenue from subscriptions. Its core revenue streams are (1) Elastic Cloud: a managed, hosted offering of Elastic’s products delivered as a cloud service (including deployments on major public clouds), wh...
Elastic Earnings Call Summary
Earnings Call Date:May 28, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Dec 02, 2026
Earnings Call Sentiment Positive
The call conveys a predominantly positive operational and strategic picture: strong backlog (CRPO/RPO) acceleration, steady revenue and subscription growth, margin expansion, robust adjusted free cash flow, large customer wins, and notable AI product traction and adoption. Near‑term variability is acknowledged — driven by a shift toward cloud commitments that delay some revenue recognition, a flattish monthly SMB cloud cohort, reliance on ramped sales execution for back‑half acceleration, and a one‑time GAAP tax benefit that clouds GAAP comparability. Overall, strengths in AI positioning, product differentiation, and improving unit economics outweigh the short‑term timing and mix headwinds.Positive Updates
Accelerating Backlog and Contract Metrics (CRPO / RPO)
Q4 CRPO grew to $1.2B (20% YoY) and RPO accelerated to $1.98B (28% YoY). Non-current RPO (beyond 12 months) grew 43% YoY, signaling stronger multi‑year commitments and backlog that should convert to revenue over the next 12+ months.
Negative Updates
Cloud Commitment Mix Impacted Q4 Recognized Revenue
A larger mix of cloud (Elastic Cloud) commitments in Q4 shifted revenue recognition toward future periods (cloud commitments ramp over time), which depressed in‑quarter recognized revenue despite stronger commitments and backlog.
Read all updates
Q4-2026 Updates
Positive
Negative
Accelerating Backlog and Contract Metrics (CRPO / RPO)
Q4 CRPO grew to $1.2B (20% YoY) and RPO accelerated to $1.98B (28% YoY). Non-current RPO (beyond 12 months) grew 43% YoY, signaling stronger multi‑year commitments and backlog that should convert to revenue over the next 12+ months.
Read all positive updates
Company Guidance
Elastic's guidance for FY27 calls for Q1 total revenue of $469–$470M (≈13.1% y/y at midpoint; 12.8% cc), sales‑led subscription revenue of $392–$393M (≈15.9% y/y; 15.6% cc), non‑GAAP operating margin of ~14%, and non‑GAAP diluted EPS of $0.57–$0.59 on 106–107M diluted shares. For the full year FY27 they expect total revenue of $1.985–$2.0B (≈14.6% y/y at midpoint; 14.5% cc), sales‑led subscription revenue of $1.673–$1.688B (≈16.9% y/y; 16.8% cc), non‑GAAP operating margin of ~19%, non‑GAAP diluted EPS of $3.21–$3.29 on 107.5–108.5M shares, and adjusted free cash flow margin of ~21.5% (ex‑acquisitions/one‑offs). The company expects to expand operating margin by ~2.5 percentage points in FY27, remain net headcount positive, see Q1 as the lowest‑growth quarter with acceleration into Q4, and reaffirmed medium‑term targets of roughly 25% non‑GAAP operating margin and >20% sales‑led subscription growth by FY29.Elastic Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
83
Very Positive
Cash Flow
88
Very Positive
| Breakdown | Apr 2026 | Apr 2025 | Apr 2024 | Apr 2023 | Apr 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.74B | 1.48B | 1.27B | 1.07B | 862.37M |
| Gross Profit | 1.32B | 1.10B | 937.24M | 772.36M | 630.18M |
| EBITDA | 34.67M | 6.05M | -78.63M | -171.49M | -157.34M |
| Net Income | 367.77M | -108.11M | 61.72M | -236.16M | -203.85M |
Balance Sheet | |||||
| Total Assets | 3.15B | 2.59B | 2.24B | 1.74B | 1.64B |
| Cash, Cash Equivalents and Short-Term Investments | 1.37B | 1.40B | 1.08B | 915.21M | 860.95M |
| Total Debt | 591.56M | 595.01M | 593.70M | 594.23M | 594.22M |
| Total Liabilities | 1.88B | 1.67B | 1.50B | 1.34B | 1.23B |
| Stockholders Equity | 1.28B | 927.23M | 738.18M | 398.90M | 415.43M |
Cash Flow | |||||
| Free Cash Flow | 321.80M | 261.82M | 145.31M | 32.98M | -1.75M |
| Operating Cash Flow | 326.89M | 266.17M | 148.76M | 35.66M | 5.67M |
| Investing Cash Flow | 26.07M | -118.67M | -287.96M | -272.95M | -127.27M |
| Financing Cash Flow | -312.27M | 40.95M | 40.05M | 17.47M | 602.13M |
Elastic Risk Analysis
Elastic disclosed 71 risk factors in its most recent earnings report. Elastic reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Elastic Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $5.81B | 14.47 | 11.28% | ― | 8.08% | -18.39% | |
79 Outperform | $8.36B | 22.36 | 37.43% | ― | 17.26% | ― | |
76 Outperform | $14.47B | 101.47 | 5.72% | ― | 17.94% | -69.28% | |
75 Outperform | $944.75M | 5.83 | 76.52% | ― | 3.69% | ― | |
69 Neutral | $3.66B | -43.94 | -8.46% | ― | 20.35% | 48.42% | |
69 Neutral | $7.04B | -273.76 | -2.66% | ― | 24.90% | -233.01% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
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Elastic Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Elastic adds AI-focused Microsoft veteran to board
Positive
Aug 27, 2026
Elastic N.V. (NYSE: ESTC) is an infrastructure technology company that integrates search technology with artificial intelligence to power its Elasticsearch Platform, which underpins its search, observability and security solutions. Its products ar...
Business Operations and StrategyExecutive/Board Changes
Elastic Announces Workforce Restructuring to Realign AI Strategy
Negative
Jun 24, 2026
On June 23, 2026, Elastic N.V. approved a restructuring plan to realign investments with strategic priorities for the age of AI automation, targeting simpler team structures, faster decision-making, and a greater focus on key growth areas. The pla...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.