It's been a good week for Dynatrace, Inc. (NYSE:DT) shareholders, because the company has just released its latest full-year results, and the shares gained 9.7% to US$53.37. Dynatrace reported US$1.7b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.59 beat expectations, being 6.8% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Dynatrace after the latest results.

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Taking into account the latest results, the most recent consensus for Dynatrace from 35 analysts is for revenues of US$1.96b in 2026. If met, it would imply a notable 15% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to tumble 49% to US$0.82 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.94b and earnings per share (EPS) of US$0.72 in 2026. Although the revenue estimates have not really changed, we can see there's been a nice increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

See our latest analysis for Dynatrace

There's been no major changes to the consensus price target of US$63.65, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Dynatrace at US$70.00 per share, while the most bearish prices it at US$55.00. This is a very narrow spread of estimates, implying either that Dynatrace is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Dynatrace's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Dynatrace's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 15% growth on an annualised basis. This is compared to a historical growth rate of 22% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 13% annually. Factoring in the forecast slowdown in growth, it looks like Dynatrace is forecast to grow at about the same rate as the wider industry.

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The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Dynatrace's earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$63.65, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Dynatrace. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Dynatrace analysts - going out to 2028, and you can see them free on our platform here.

We also provide an overview of the Dynatrace Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock,  here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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