Dynatrace (DT) continues to be "well-position" in the software sphere, boosted by artificial intelligence and cloud growth amid a broader demand environment for its platform, Wedbush said in a Thursday note.
The company's earnings and revenue beats in its recent fiscal Q4 results will be overshadowed by its lighter-than-expected near-term operating income guidance due to margin pressures, Wedbush analysts said.
Total annual recurring revenue of $2.05 billion came in just short of the Street's estimate of $2.06 billion, the analysts said.
They noted that $81 million in net new annual recurring revenue marked an increase from the previous period and was driven by Dynatrace Platform Subscription and new products from both new and existing customers.
Dynatrace's long-term roadmap remains intact, while Starboard Value's involvement is expected to improve sentiment around the company, according to the note.
Wedbush maintained the company's stock rating at outperform and lowered the price target to $48 from $55.
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