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Dynatrace (DT) Gains As Market Dips: What You Should Know

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Dynatrace (DT - Free Report) closed at $53.69 in the latest trading session, marking a +0.22% move from the prior day. This change outpaced the S&P 500's 0.02% loss on the day. Meanwhile, the Dow gained 0.23%, and the Nasdaq, a tech-heavy index, lost 0.12%.

Heading into today, shares of the software intellegence company had gained 6.1% over the past month, outpacing the Computer and Technology sector's gain of 3.63% and the S&P 500's gain of 5.14% in that time.

Investors will be hoping for strength from Dynatrace as it approaches its next earnings release, which is expected to be August 2, 2023. The company is expected to report EPS of $0.22, up 22.22% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $326.89 million, up 22.31% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1 per share and revenue of $1.4 billion. These totals would mark changes of +3.09% and +20.87%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Dynatrace. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Dynatrace is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that Dynatrace has a Forward P/E ratio of 53.7 right now. This valuation marks a premium compared to its industry's average Forward P/E of 21.85.

Also, we should mention that DT has a PEG ratio of 5.9. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. DT's industry had an average PEG ratio of 2.24 as of yesterday's close.

The Computers - IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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