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Investing.com - TD Cowen raised its price target on Elastic NV (NYSE:ESTC) to $105.00 from $85.00 on Friday, while maintaining a Hold rating on the stock. Currently trading at $87.79, Elastic has seen analyst targets ranging from $85 to $143, with InvestingPro data showing strong analyst support with 19 upward earnings revisions for the upcoming period.
The firm cited Elastic’s strong quarterly performance, with cloud revenues growing $14 million quarter-over-quarter, exceeding both buy-side expectations and beating Street estimates by $5 million. Self-managed revenue beat expectations by $11 million, driving most of the total revenue outperformance. This momentum is reflected in Elastic’s impressive 17.42% year-over-year revenue growth, with total revenue reaching $1.55 billion.
TD Cowen noted that Elastic’s cloud price increase was successfully implemented, with customer optimization afterward being "well absorbed." Macroeconomic effects were better than expected, including stabilization in the U.S. public sector.
Despite these positive developments, the firm highlighted several mixed signals in Elastic’s results. Billings missed Street expectations, while contracted remaining performance obligation (cRPO) and remaining performance obligation (RPO) both declined quarter-over-quarter. Net expansion rate (NER) remained flat, and net new customer additions continued to be weak.
The price target increase reflects TD Cowen’s assessment of Elastic’s improved cloud performance, though the firm maintained its Hold rating due to the mixed bookings metrics and questions surrounding the impact of pricing adjustments in Elastic’s consumption model. InvestingPro analysis indicates that Elastic is currently trading near its Fair Value, with additional metrics and insights available in the comprehensive Pro Research Report, part of the coverage of over 1,400 US stocks.
In other recent news, Elastic NV reported strong first-quarter earnings, exceeding revenue expectations by $18 million, largely driven by growth in its Elastic Cloud business. This performance led the company to raise its full-year revenue guidance by the same amount. Analysts have responded positively to these developments, with Stifel increasing its price target for Elastic to $134, maintaining a Buy rating. Guggenheim also raised its price target to $122, citing Elastic’s significant outperformance in revenue and profit and noting that the company provided guidance above Street expectations. RBC Capital raised its price target to $125, highlighting Elastic’s strong start to the year and stable macroeconomic conditions. Meanwhile, Cantor Fitzgerald reiterated a Neutral rating with a price target of $92, despite acknowledging the company’s strong performance. KeyBanc maintained its Sector Weight rating, noting the broader acceleration in consumption software names and Elastic’s solid results. These updates reflect a broadly positive outlook from analysts following Elastic’s recent financial disclosures.
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