Elastic Earnings: Robust Sales and Profitability to Finish off Fiscal 2024

We are maintaining our $92 fair value estimate for narrow-moat Elastic after the firm closed out fiscal 2024 with a strong showing. In our valuation, we offset the strong quarterly results with the firm’s disappointing preliminary fiscal 2025 sales guidance below our prior estimates. We remain optimistic about Elastic’s long-term market opportunity, especially as increased investments and customer interest in artificial intelligence should drive more sales for the firm’s Elasticsearch offering. With the firm’s shares trading up afterhours, we view Elastic as fairly valued relative to our unchanged fair value estimate.