Elastic: A Stretchable Rally? Reiterating Buy For The Brave Hearted
- We called a buying opportunity on Elastic in late October, since which the stock reported its 2QFY25 results and soared 44%.
- Elastic carved itself a unique spot within AI to help companies filter through which data to train AI on and just launched its Elastic AI ecosystem to feed that appetite.
- Management's effective handling of go-to-market headwinds confirms our optimism about management's execution going forward.
- Having said that, a lot of the positives got priced in with the stock's RSI (relative strength index) at 86 heading into Tuesday's trading from 38 when we last published.
- We like Elastic's midterm position to outperform. We do think investors should be wise about when to jump into the stock for the best returns, and we think that would be at a lower RSI.
Hiroshi Watanabe
We picked up our coverage of Elastic (NYSE:ESTC) in late October at a stock price of $77.61 per share based on our belief that there was a buying opportunity for Elastic at current levels after management
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