Needham analyst Mike Cikos has maintained their neutral stance on DT stock, giving a Hold rating on February 6.
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Mike Cikos has given his Hold rating due to a combination of factors that emerged from a recent conversation with a Dynatrace customer. The discussion centered around the Dynatrace Platform Subscription (DPS), an area of interest for investors because of its $12 million contribution to year-to-date Subscription Revenue from On-Demand Consumption. The feedback from the customer indicated that the DPS licensing has been successful in increasing expenditure on Dynatrace by offering a wider range of functionalities.
Despite the positive feedback on DPS, the customer has planned for On-Demand spending to avoid over-commitment. The structure of the DPS contract is a 3-year agreement with consistent annual commitments and stable unit pricing, which has been in use since October 2024. These factors suggest a stable but not overly aggressive growth path for Dynatrace, leading to the Hold rating by Mike Cikos.
In another report released on February 6, Piper Sandler also maintained a Hold rating on the stock with a $55.00 price target.