Background
Dynatrace (DT) is a provider of software that makes it easier to monitor software running in the cloud. DT is providing something that is essential to the next generation of software running the world.
Less than a decade ago, it was a lot easier to monitor how software was working. An engineer could observe an application running on a laptop or desktop. If something went wrong, the engineer can attach a special tool to debug what was broken. Even software running on a powerful server in the companies data center can be observed easily.
Software that runs in the cloud is out of sight. Often you only know its working if a website returns the correct web page. But going beyond that becomes magnitudes more difficult than before. And lately, more companies are spreading software across multiple clouds from Microsoft, Amazon and Google. Keeping that multi-cloud software healthy is a big challenge.
DT built a platform that uses Automation and Artificial Intelligence to make this very complex problem much easier for software developers and system engineers. The addressable market is massive and growing as more companies are accelerating digital transformation forced by the pandemic. As companies move to second and third generation multi-cloud applications, the software is becoming more complex and harder to operationalize.
In addition to this core business, Dynatrace is innovating to take the data that passes through their product and turn it into invaluable business insights. Data is the new oil. That innovation will expand their total addressable market by billions.
Fundamentals
Technicals
Idea
Buy point at 39.39 up to 41.36. Stop Loss based on a 10d ATR (x2.7) set to 9.25%. Position size at R10.82.
Dynatrace (DT) is a provider of software that makes it easier to monitor software running in the cloud. DT is providing something that is essential to the next generation of software running the world.
Less than a decade ago, it was a lot easier to monitor how software was working. An engineer could observe an application running on a laptop or desktop. If something went wrong, the engineer can attach a special tool to debug what was broken. Even software running on a powerful server in the companies data center can be observed easily.
Software that runs in the cloud is out of sight. Often you only know its working if a website returns the correct web page. But going beyond that becomes magnitudes more difficult than before. And lately, more companies are spreading software across multiple clouds from Microsoft, Amazon and Google. Keeping that multi-cloud software healthy is a big challenge.
DT built a platform that uses Automation and Artificial Intelligence to make this very complex problem much easier for software developers and system engineers. The addressable market is massive and growing as more companies are accelerating digital transformation forced by the pandemic. As companies move to second and third generation multi-cloud applications, the software is becoming more complex and harder to operationalize.
In addition to this core business, Dynatrace is innovating to take the data that passes through their product and turn it into invaluable business insights. Data is the new oil. That innovation will expand their total addressable market by billions.
Fundamentals
- Last three quarters EPS growth of 267%, 333% and 200% YoY
- Last three quarters of Sales growth 30%, 27%, 30% YoY
- Last quarter earnings surprise of 80%
- Sponsorship doubled in the past year
- More debt than other industry group leaders
Technicals
- 80% earnings surprise came amidst 10/28,29 market down turn and rotation
- The down day caused a confirmation on a 20w head and shoulders pattern. Note the breakdown through the neckline.
- Held support from late May to form a double-bottom pattern
- Double-bottom formed between May support and the neckline of head-and-shoulders pattern
- Volume is drying up as final sellers move out
Idea
Buy point at 39.39 up to 41.36. Stop Loss based on a 10d ATR (x2.7) set to 9.25%. Position size at R10.82.
- Buy Point: 39.39 - 41.36
- Stop Loss: 9.25% (35.74 - 37.53
- Position Size: R10.82