Dynatrace (DT)
NYSEInformation TechnologySoftware - ApplicationSnapshot 2026-09-04
$51.90-1.63%
Close 2026-09-04 · 1-day change
NYSEInformation TechnologySoftware - ApplicationSnapshot 2026-09-04
Intact: The reason to own it still holds.
Dynatrace grows revenue 19% yearly to $2.0B with ARR up 18% to $2.05B. Profit margins stay strong near 29%. Free cash flow remains solid. AI tailwinds and analyst upgrades support growth acceleration.
Revenue growth could slow below 18% due to market headwinds. Profit margins may compress if costs rise. A guidance cut signals risk to near-term targets.
The price is about 21% below our fair value near $57, reflecting roughly 18% revenue growth. Our fair value is 27% above the Street median, indicating upside versus consensus.
Breaks if: ARR growth falls below 18% YoY in FY26 Q4
Continue accelerating annual recurring revenue (ARR) and total revenue growth with focus on cloud-native and AI-driven workloads.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on growth and profitability. The current thesis is intact, supported by recent financial performance that remains strong relative to its industry.
The valuation is considered expensive compared to peers, with a premium of 1.38. The market seems to have priced in a stable growth trajectory, as indicated by a low expectations gap.
Fundamentals are likely to remain strong, with management on track to achieve its priorities of increasing revenue growth and enhancing profitability. However, there is a low probability of missing earnings expectations, which could pose risks.
The long-term thesis hinges on management's ability to maintain growth and profitability, as well as external factors like potential interest rate cuts by the Fed and performance from sector leaders. Any negative guidance from DT could significantly impact credibility.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports revenue growth. The acquisition of Arize enhances the AI observability platform. This investment aligns with product advancement goals.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated as a priority in 4 of last 4 quarters. ARR grew from $1,972 million in 2026-Q3 to $2,136 million in 2027-Q1, and total revenue increased from $515 million to $555 million over the same period. Management consistently emphasized accelerating ARR and revenue growth driven by cloud-native and AI workloads, and the financials show delivering progress on this priority.
“Dynatrace delivered ARR growth of 17% and total revenue growth of 16% in Q1 fiscal 2027.”
“Fourth quarter ARR increased 18% and total revenue increased 19% year-over-year.”
“Third quarter ARR increased 20% and total revenue increased 18% year-over-year.”
“Second quarter ARR growth of 16% on a constant currency basis.”
Breaks if: Non-GAAP operating margin falls below 29% in FY26 Q4
Breaks if: Revenue falls below $2,326 million in FY27 Q3
Continue accelerating annual recurring revenue (ARR) and total revenue growth with focus on cloud-native and AI-driven workloads.
Stated as a priority in 4 of last 4 quarters. ARR grew from $1,972 million in 2026-Q3 to $2,136 million in 2027-Q1, and total revenue increased from $515 million to $555 million over the same period. Management consistently emphasized accelerating ARR and revenue growth driven by cloud-native and AI workloads, and the financials show delivering progress on this priority.
“Dynatrace delivered ARR growth of 17% and total revenue growth of 16% in Q1 fiscal 2027.”
“Fourth quarter ARR increased 18% and total revenue increased 19% year-over-year.”
“Third quarter ARR increased 20% and total revenue increased 18% year-over-year.”
“Second quarter ARR growth of 16% on a constant currency basis.”
Overall, DT's strong operational metrics support a positive long-term view, but elevated risks must be monitored closely. Not investment advice.