Dynatrace (NYSE:DT) Price Target Cut to $70.00 by Analysts at Citigroup

Key Points

• Citigroup cut Dynatrace’s price target from $75 to $70 but maintained its Buy rating; the new target implies about 50% upside from the cited share price of $46.69.
• Analyst sentiment remains broadly positive: 24 analysts rate the stock Buy and eight Hold, for a consensus “Moderate Buy” rating.
• Dynatrace beat quarterly estimates, reporting EPS of $0.54 and revenue of $579.9 million, and authorized a $1 billion share repurchase covering up to 6.3% of shares.

Dynatrace (NYSE:DT - Get Free Report) had its price target dropped by Citigroup from $75.00 to $70.00 in a report released on Wednesday, Benzinga reports. The firm presently has a "buy" rating on the stock. Citigroup's price target suggests a potential upside of 49.92% from the company's current price.

Several other equities analysts also recently issued reports on the stock. BNP Paribas Exane raised shares of Dynatrace from a "neutral" rating to an "outperform" rating and set a $75.00 price target for the company in a report on Thursday, October 8th. The Goldman Sachs Group restated a "buy" rating and set a $71.00 price target on shares of Dynatrace in a research report on Thursday, October 15th. Truist Financial increased their price objective on shares of Dynatrace from $60.00 to $70.00 and gave the stock a "buy" rating in a report on Wednesday, October 21st. Jefferies Financial Group reiterated a "buy" rating and issued a $75.00 price objective on shares of Dynatrace in a research report on Sunday, October 11th. Finally, UBS Group boosted their target price on shares of Dynatrace from $74.00 to $80.00 and gave the company a "buy" rating in a research note on Friday, October 23rd. Twenty-four equities research analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the stock. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $62.17.

Dynatrace Price Performance

Shares of NYSE DT traded down $0.34 during mid-day trading on Wednesday, hitting $46.69. The company had a trading volume of 15,036,410 shares, compared to its average volume of 6,710,702. The stock has a market cap of $13.49 billion, a price-to-earnings ratio of 93.39, a PEG ratio of 3.38 and a beta of 0.76. Dynatrace has a 12 month low of $31.64 and a 12 month high of $66.30. The firm's 50 day simple moving average is $57.67 and its two-hundred day simple moving average is $44.62.

Dynatrace (NYSE:DT - Get Free Report) last released its quarterly earnings data on Tuesday, November 3rd. The company reported $0.54 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.49 by $0.05. The business had revenue of $579.92 million during the quarter, compared to analyst estimates of $568.03 million. Dynatrace had a return on equity of 11.07% and a net margin of 7.22%. The business's revenue for the quarter was up 17.4% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.44 EPS. Equities analysts forecast that Dynatrace will post 1.11 earnings per share for the current year.

Dynatrace declared that its Board of Directors has approved a share repurchase plan on Tuesday, November 3rd that allows the company to buy back $1 billion in shares. This buyback authorization allows the company to repurchase up to 6.3% of its shares through open market purchases. Share buyback plans are generally a sign that the company's management believes its stock is undervalued.

Insiders Place Their Bets

In related news, EVP Bernd Greifeneder sold 50,000 shares of the stock in a transaction dated Friday, September 18th. The shares were sold at an average price of $57.21, for a total value of $2,860,500.00. Following the completion of the transaction, the executive vice president owned 904,846 shares in the company, valued at $51,766,239.66. This represents a 5.24% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 0.69% of the stock is owned by insiders.

Institutional Trading of Dynatrace

A number of hedge funds and other institutional investors have recently made changes to their positions in the stock. Bank of America Corp DE raised its position in Dynatrace by 304.7% in the first quarter. Bank of America Corp DE now owns 9,357,612 shares of the company's stock worth $346,044,000 after acquiring an additional 7,045,591 shares in the last quarter. First Trust Advisors LP boosted its position in shares of Dynatrace by 706.8% during the 1st quarter. First Trust Advisors LP now owns 6,801,507 shares of the company's stock valued at $251,520,000 after purchasing an additional 5,958,505 shares in the last quarter. Arrowstreet Capital Limited Partnership bought a new position in shares of Dynatrace during the 1st quarter valued at about $190,890,000. Amundi boosted its position in shares of Dynatrace by 461.5% during the 1st quarter. Amundi now owns 6,238,938 shares of the company's stock valued at $230,716,000 after purchasing an additional 5,127,910 shares in the last quarter. Finally, Bank of New York Mellon Corp acquired a new position in shares of Dynatrace in the 2nd quarter worth approximately $114,885,000. 94.28% of the stock is currently owned by institutional investors.

Key Dynatrace News

Here are the key news stories impacting Dynatrace this week:

• Positive Sentiment: Dynatrace authorized a $1 billion share repurchase, allowing it to buy back up to 6.3% of its shares. The program may support demand for the stock and signals management sees value at current levels. Share buyback report
• Positive Sentiment: Dynatrace and CrowdStrike announced a strategic security and observability partnership, which could broaden their joint customer offering. Partnership announcement
• Neutral Sentiment: Several firms lowered their price targets following the results but retained bullish ratings: Barclays to $61 and Wells Fargo to $65 (both Overweight), RBC to $68 (Outperform), BMO to $60 (Outperform), and UBS to $75 (Buy). These cuts temper expectations, while the ratings and targets still imply upside from recent levels. Analyst target changes
• Negative Sentiment: The main pressure is Dynatrace’s profit and cash-flow outlook: reports say acquisition-related impacts contributed to a trimmed forecast, overshadowing Q2 adjusted EPS of $0.54 and revenue of $579.9 million, both above consensus. Shares fell sharply after the results as investors reacted to the outlook rather than the quarterly beat. Earnings and outlook report
• Negative Sentiment: Wedbush cut its target to $50 from $54 and moved to Neutral, adding to concern that near-term upside may be limited. Wedbush rating information

Dynatrace Company Profile

Dynatrace, Inc provides an observability and application security platform designed to help organizations monitor, analyze and optimize complex digital environments. Its software uses artificial intelligence and automation to provide visibility across applications, infrastructure, cloud services, logs, user experiences and business operations.

The company's products support application performance monitoring, infrastructure monitoring, digital experience monitoring, log and analytics management, cloud automation and application security.

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