Dynatrace

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Aktien Stammtisch

@Aktien_Stammtisch

1Settimana·

𝐃𝐲𝐧𝐚𝐭𝐫𝐚𝐜𝐞: 𝐐𝟐 𝐄𝐚𝐫𝐧𝐢𝐧𝐠𝐬 𝐚𝐧𝐝 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐁𝐞𝐚𝐭 𝐄𝐬𝐭𝐢𝐦𝐚𝐭𝐞𝐬, 𝐑𝐚𝐢𝐬𝐞𝐬 𝐅𝐘𝟐𝟎𝟐𝟕 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐎𝐮𝐭

$DT (+2,57%)

⠀

📊 𝐑𝐞𝐬𝐮𝐥𝐭𝐬

• Non-GAAP EPS: $0.54 (Est. $0.49) ✅, +23% YoY.

• Revenue: $579.9M (Est. $568.12M) ✅, +17% YoY.

• GAAP EPS: $0.23 (vs. $0.19 YoY).

• ARR: $2.207B, +16% YoY.

• Subscription Revenue: $553.1M, +17% YoY.

• Non-GAAP Operating Income: $184.3M, +21% YoY.

• Non-GAAP Operating Margin: 32%, +100 bps YoY.

• Adjusted Free Cash Flow: $42.3M, +52% YoY.

⠀

🎯 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞

• Q3 FY2027 Revenue: $591M–$596M, midpoint $593.5M (Est. $594.84M) ❌.

• Q3 Non-GAAP EPS: $0.44–$0.45, midpoint $0.445 (Est. $0.48) ❌.

• FY2027 Revenue: $2.330B–$2.340B, midpoint $2.335B (Est. $2.33B) ✅, raised from $2.306B–$2.320B.

• FY2027 Non-GAAP EPS: $1.88–$1.90 (Est. $1.91) ❌, cut from $1.97–$1.99.

• FY2027 ARR: $2.393B–$2.413B, raised from $2.359B–$2.379B.

• FY2027 Non-GAAP Operating Margin: 28.0%–28.25%, lowered from 29.5%–29.75%.

• FY2027 Adjusted Free Cash Flow: $600M–$605M, lowered from $610M–$615M.

⠀

📌 𝐊𝐞𝐲 𝐓𝐚𝐤𝐞𝐚𝐰𝐚𝐲𝐬

• Q2 adjusted EPS beat consensus by ~10.2%, while revenue exceeded estimates by ~2.1%.

• Platform consumption grew over 20% YoY, with AI customers consuming more than twice as fast as other customers.

• Log management grew more than 100% YoY, while infrastructure management surpassed $500M in annualized consumption.

• More than 1,100 customers now use Dynatrace agents for autonomous operations, up from 800+ last quarter.

• Completed the Arize acquisition on October 1, expanding AI evaluation and LLM monitoring capabilities.

• Arize is expected to add ~200 bps to FY2027 ARR growth but dilute non-GAAP operating margin by ~175 bps.

• Announced a strategic partnership with CrowdStrike combining cybersecurity and observability.

• Authorized an additional $1B in share repurchases, bringing remaining buyback capacity to ~$1.3B.

• Investor Day scheduled for February 16, 2027, with a roadmap toward a Rule of 50 profile in FY2029.

⠀

💬 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭 𝐂𝐨𝐦𝐦𝐞𝐧𝐭𝐚𝐫𝐲

“As organizations increasingly deploy AI agents into production, the need for enterprise-grade observability and governance has never been greater.”

Tenbagger-Capital

@Tenbagger-Capital

3Settimana·

AI Agents as Drivers of Observability. The Second Wave

Hello, everyone,

Analysts are now also keeping an eye on the second wave, and price targets are already being raised.

Just like with my company overview today.

$DT (+2,57%)

Jefferies sees Dynatrace : More AI agents could require additional monitoring agents and thus more workloads to monitor. The higher price target of $75 signals that analysts believe the company can capitalize on this demand. The rating remains “Buy.”

Matthew Hedberg, an analyst at RBC Capital, raised his price target for Dynatrace stock from $59 to $73 and reaffirmed the “Outperform” rating. The adjustment reflects positive channel checks and the expectation of sustained operational momentum, following a strong first fiscal quarter with 41% organic, currency-adjusted growth in net annual recurring revenue.

Hedberg noted that the company is seeing sustained demand for its log management offerings, supported by a strong go-to-market strategy that is driving robust new customer acquisition. AI capabilities are also emerging as a significant growth driver for the business, as enterprise demand for unified observability and security continues to rise.

Dynatrace, Inc.. is an artificial intelligence (AI)-based observability platform. The company is advancing observability for digital enterprises and transforming the complexity of modern digital ecosystems into assets. It enables companies to analyze and automate. The platform combines comprehensive and in-depth observability, continuous runtime application security, and advanced AI to support IT operations, development, security, and business teams. This enables companies to optimize their cloud and IT operations, accelerate secure software delivery, and improve digital performance. The platform’s solutions include infrastructure observability, application observability, AI observability, digital experience, business analytics, software delivery, threat observability, application security, and log management. Application security detects, analyzes, and remediates vulnerabilities and attacks on applications in real time.

Number of employees: 5,600

FINAL_Dynatrace+Arize+Investor+Presentation+August+2026.pdf

Dynatrace + Arize: The Next Step in Growth Amid the AI Wave

My summary of the August 2026 investor presentation: Dynatrace no longer wants to merely monitor whether software functions technically. The company also wants to ensure that AI applications and autonomous AI agents operate reliably, efficiently, and cost-effectively. Arize was acquired for this purpose.

What makes this combination so interesting?

The two companies complement each other:

Dynatrace: Monitors applications, cloud infrastructure, software performance, and security.
Arize: Analyzes and evaluates AI models, large language models (LLMs), and AI agents. This includes, for example, detecting erroneous or fabricated AI responses.
Common goal: To monitor the entire lifecycle of an AI application—from development through testing to production.

An example: A company uses an AI agent for customer service. While the agent functions flawlessly from a technical standpoint, it provides incorrect answers. Traditional infrastructure monitoring alone cannot reliably detect this problem. The combination of AI evaluation and observability is designed to make such errors visible and identify their causes more quickly.

2. Key figures from the presentation

Metric

Details

Purchase price of the Arize transaction:

$915 million

Of which, cash component:

approx. $815 million

Estimated market potential for AI observability through 2030:

over $10 billion

Expected additional contribution to ARR growth in 2027:

approx. 2 percentage points

Expected impact on the adjusted operating margin in 2027:

−1.75 percentage points

Planned completion:

now completed

The acquisition was completed on October 1, 2026.

(ARR stands for Annual Recurring Revenue.)

3. Why does this fit with the second wave of AI?

The first wave of AI was heavily focused on infrastructure: data centers, GPUs, storage, and networking technology.

In the second wave, a different question takes center stage:

How can companies actually use AI productively and make money from it?

To do so, they need, among other things:

Reliability: Do AI applications and agents actually work under real-world conditions?
Quality control: Do they produce accurate, helpful, and secure results?
Cost control: What are the costs per request or per agent process executed?
Error analysis: Is the problem with the model, the prompt, the application, or the infrastructure?
Automation: Can errors be detected more quickly and, in some cases, resolved automatically?

This is precisely where Dynatrace positions itself with Arize.

The acquisition makes strategic sense. However, the key question will be whether Dynatrace can actually generate additional recurring revenue and higher long-term profits from the expanded platform.

4. My Conclusion for the 2036 Portfolio

I find Dynatrace’s strategic direction compelling.

The company isn’t simply relying on yet another AI assistant. It is positioning itself around a key prerequisite for the widespread adoption of AI: companies must be able to understand whether their AI systems are operating reliably, what costs they incur, and what business value they deliver.

I find three points particularly interesting:

Monetization: Dynatrace can sell additional features to existing enterprise customers.

Structural growth: As AI agents become more widespread, the need to monitor their behavior and results increases.

Platform advantage: The combination of AI evaluation, application monitoring, and infrastructure diagnostics could further embed Dynatrace into its customers’ workflows.

My assessment: Dynatrace is an interesting candidate for the second wave of AI. The Arize acquisition improves its strategic positioning. Whether this will also translate into an attractive investment, however, continues to depend on revenue growth, margin trends, and the expectations already priced into the stock.

The most important metric we should watch in the coming quarters is therefore ARR growth in conjunction with the operating margin. This will show whether the additional AI features are actually driving growth rather than just increasing costs.

Q1 FY 2027 Financial Results

Q1+FY27+Investor+Deck+-+FINAL+8.5.2026.pdf

Dynatrace Q1 FY2027 – Key Takeaways

My brief summary: Dynatrace is benefiting from the increasing complexity of cloud and AI systems. What’s particularly interesting is that the company isn’t just keeping pace with the growth of AI infrastructure—by monitoring and optimizing AI applications, it’s also capitalizing on the second wave of AI—monetization— .

Key Figures

Revenue:

$555 million

+16%

Subscription revenue:

$530 million

+16%

Annual Recurring Revenue (ARR):

$2.136 billion

+17%

Operating Income (Non-GAAP):

$162 million

–

Operating Cash Flow

: $306 million

–

Adjusted Free Cash Flow:

$309 million

Dynatrace generates the majority of its revenue from recurring software subscriptions. This provides a revenue base that is relatively easy to forecast.

Important: In August, the company lowered its full-year forecast for fiscal year 2027. The current revenue forecast is $2.306 to $2.320 billion. Among other reasons, Dynatrace cites changed exchange rate assumptions. This is something to keep an eye on despite the strong first quarter.

Through the acquisition of Arize AI, Dynatrace aims to expand its capabilities for monitoring and evaluating AI models and AI agents. The company sees a market potential of more than $10 billion in the AI observability sector by 2030.

Are there dependencies on individual customers?

The good news: According to the annual report, there is no significant direct revenue dependence on any single end customer.

The annual report for fiscal year 2026 contains the following information:

Number of customers: Approximately 4,100 (broad customer base)

No single end customer accounts for more than 10% of revenue

International presence: Over 110 countries (geographic diversification)

Revenue model: Primarily subscriptions

The figures refer to the fiscal year ending March 31, 2026.

Dependence on major cloud platforms is a separate issue

Dynatrace integrates with major cloud and technology ecosystems, including AWS, Microsoft Azure, and Google Cloud. This is important for technical reach and customer access. However, this does not automatically mean that any one of these providers accounts for a large share of Dynatrace’s revenue. Such dependence must be distinguished from direct customer concentration.

My conclusion: The combination of recurring revenue, a broad customer base, and AI-powered observability is attractive.

Latest News

Oct. 12, 2026, 9:00 a.m. EDT

Dynatrace erreicht den FedRAMP Class D (High) Status "Initial Implementation", um die sensibelsten Workloads der Bundesregierungskunden zu unterstützen

Oct. 1, 2026, 4:05 p.m. EDT

Dynatrace schließt die Übernahme von Arize ab und erweitert die KI-Beobachtbarkeit über den gesamten Entwicklungszyklus

Aug. 18, 2026, 6:30 a.m. EDT

Dynatrace kündigt Preisgestaltung der Privatplatzierung von 1,25 Milliarden US-Dollar an umtauschbaren Senior-Anleihen an.

August 5, 2026, 6:30 a.m. EDT

Dynatrace berichtet Finanzergebnisse des ersten Haushaltsjahres 2027

July 29, 2026, 6:30 a.m. EDT

Dynatrace ernennt den KI- und Technologieführer Chandu Thota in seinen Vorstand

July 27, 2026, 9:00 a.m. EDT

Dynatrace bringt autonome Abläufe in Unternehmens-KI und entwickelt sich von Einsicht zu Handlung

April 8, 2026, 4:05 p.m. EDT

Dynatrace wird Bindplane erwerben, um Telemetrie-Pipelines für KI und cloud-native Beobachtbarkeit aufzubauen

Geographic Revenue Breakdown:

2026 (USD)

United States 928 million

Europe, Middle East, and Africa 649 million

Asia Pacific 193 million

Latin America 159 million

North America (Excluding the United States) 89.76 million

5. My Brief Assessment of Dynatrace

The forecast shows a growing software company with strong free cash flow. Three points stand out in particular:

Growth: Revenue is expected to rise from $1.70 billion in fiscal year 2025 to $3.29 billion in 2029. That represents nearly a doubling.
Cash Flow: Free cash flow is expected to grow from $430.6 million to $876.6 million. This would allow Dynatrace to generate significant funds for product development, AI capabilities, and further expansion.
Profitability: The EBIT margin is projected to reach 30.62% in 2029. This points to a scalable business model.

The biggest point of concern is net income: The sharp decline from $483.7 million in 2025 to $162.7 million in 2026 is striking. Since EBIT is rising at the same time, one should examine the one-time effect—or the composition of net income—more closely before concluding that there has been an operational slump.

Purchase price of the Arize transaction

$915 million

The acquisition was completed on October 1, 2026.

Conclusion: Based on these forecasts, Dynatrace is particularly attractive due to its revenue growth, high cash flow margin, and rising EBIT margin. However, when making an investment decision, one must still compare these strengths with the current stock valuation.

The reported P/E ratio is significantly higher

The difference between adjusted and reported earnings is substantial. For 2027, for example, adjusted earnings per share of $1.98 contrast with reported earnings per share of just $0.79.

That’s why I would always keep an eye on both metrics when it comes to Dynatrace. A low adjusted P/E ratio alone isn’t enough to classify the stock as undervalued.

The most stable metric for Dynatrace stock is adjusted earnings, which is used for the valuation below. The P/E ratio (price-to-earnings ratio) is 34.81 , which is 18.13 points below the historical average of 52.94 over the past 7 years. From this perspective, the Dynatrace stock appears to be to be (Source: AKTIENFINDER)

Dynatrace’s official forecast as a cross-check

On August 5, 2026, Dynatrace published its results for the first quarter of fiscal year 2027 and updated its full-year forecast.

Key figure for FY 2027

Official Forecast

Revenue

$2,306–2,320 million

Reported revenue growth

14–15%

Non-GAAP operating income

$682–690 million

Non-GAAP operating margin

29.5–29.75%

Adjusted earnings per share

$1.97–$1.99

Adjusted free cash flow

$610–615 million

Adjusted FCF margin

26.5%

Source: Dynatrace Investor Relations – Ergebnisse und Prognose für das erste Quartal des Geschäftsjahres 2027.

The company’s forecast for adjusted earnings per share is thus virtually in line with the analyst estimate of $1.98. This serves as a useful plausibility check.

Note, however, that the non-GAAP metrics are adjusted figures and should not be equated with the reported IFRS/GAAP results.

My conclusion: Based on adjusted analyst estimates, Dynatrace is becoming more attractively valued as the forecast horizon extends. The combination of expected earnings growth and rising free cash flow is particularly appealing.

I would therefore consider Dynatrace an an interesting candidate for the second wave of AI . The key factor is whether the company can successfully monetize AI features and sustainably expand its margins and cash flows.

One final step is still needed for a buy decision: a valuation using a consistent, current stock price and a comparison of expected earnings growth with the risks. The table above therefore deliberately separates the adjusted valuation from the valuation based on reported earnings.

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Dynatrace Stock

54.50 EUR

61.52 USD

+ 2

8 Commenti

Chris@Multibagger

3Settimana

My biggest problem right now is that it’s hard for me to gauge when the second-wave companies will start outperforming the first-wave ones. Since I only have a small five-figure portfolio so far, I can’t diversify widely with six- or seven-figure capital.

•

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Konstantin A. Harrer

@KA_Harrer

1Anno·

Oct 24 / A Week of Many Trades

Probably even too many

This week felt like a portfolio spring cleaning (in October) with part discipline, part opportunity, and maybe a touch of restlessness. Five trades in total, all within days of each other. I usually prefer slower, more deliberate moves, but some action was necessary. Let me run you through why:

The first trade was one I discussed in a post a few days back: rotating Gambling.com into Evolution AB. The decision came down to quality over theory, and the loss came down to my ego not being able to accept that I had a flawed thesis. Gambling.com looked great on paper but was fragile in practice: no moat, heavy dependence on SEO, and questionable defensibility. Evolution, on the other hand, is a powerhouse. It owns roughly three-quarters of the live casino market, earns free cash flow margins north of 50%, and runs one of the most technically complex infrastructures in the industry. Same sector, same trend, but one is an obscure bet, while the other is a toll booth. It was time to stop gambling and start owning the house’s supplier. Though I should add that Evolution’s stock tanked just a day after I opened my position, due to less-than-pretty earnings. But I don’t see much more downside from here with the moat and valuation, plus I am in it for the long game.

Second was Novo Nordisk. The timing was perfect for a long-term investor, as the board-resigning chaos briefly rattled the market. I doubled down during the noise. When a company sits at the epicenter of one of the largest secular trends in healthcare, short-term governance issues don’t matter much. For Novo, so many negative factors boiled together over the last few months, and I am loading up as long as the weakness in the stock price persists. Obesity and diabetes treatments are reshaping medicine, and Novo is leading that charge in a duopoly with Eli Lilly (also in my portfolio). The step-down headlines were just a distraction in a story that’s still writing itself. One of my highest-conviction comeback bets.

Next, I added InPost, the Polish locker network that’s quietly conquering major parts of Europe. The setup feels rare: founder-led, capital-light, and misunderstood. At barely over a 14× forward P/E, it’s priced like a slow-growth utility, not a network-effect logistics play expanding across multiple countries. The Allegro dispute scared investors, but the math doesn’t justify the discount. This is exactly the kind of calculated risk that balances my otherwise very U.S.-heavy portfolio. It’s refreshing to find a great growth opportunity in Europe, rather than one more left-behind carmaker.

After that came a structural adjustment — selling MSCI. I still like the business, but it’s almost redundant next to S&P Global, which already makes up my largest holding. Both share similar moats, models, and margins, and owning both represents more correlation than diversification. Between the two, S&P offers greater breadth and slightly better pricing power. So I let MSCI go, not because it failed, but because I want focus.

Lastly, I trimmed Dynatrace. A small, clean sale with about a 5% return. It’s a great company, but considering the stretched valuation, I think better opportunities exist within the same sector. I’d rather recycle the capital into cheaper, equally capable players like Salesforce or Atlassian. Sometimes great companies don’t make great investments, and I fear that we could see a sideways run for the observability player.

Looking back, it was an unusually active week. But every trade had a clear logic: higher quality, less overlap, better risk/reward. If anything, it’s a reminder that good portfolio management isn’t about doing nothing — it’s about acting with purpose when the puzzle pieces start to shift. And this week, they did.

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Konstantin A. Harrer

@KA_Harrer

1Anno·

📈 August 2025 Portfolio Recap – First Month in Review

Introduction

It has now been a little bit over a month since I published my first portfolio review. I started this portfolio on July 23 and will continue to share monthly recaps from now to, hopefully, a very long time. My goal with these updates is simple: transparency. They are to document performance regularly, explain my investment process, and create a track record of decisions that I can learn from and reflect on over time. I will focus on what worked and what did not, while keeping the macro picture and long-term perspective over short-term volatility in mind. As I pointed out in my last review, I strive to become a hedge fund manager, and while there is still a long way to go, and many lessons to be learned, this portfolio will be my primary credential for the future.

Unlike a traditional investor letter, this recap is designed to be professional yet approachable, so it can serve as a portfolio log and as a resource or inspiration for anyone interested in equity investing. Yes, I am doing this primarily because I love investing and diving into company reports and stock market news, but I also want to share my journey and hopefully be able to use my passion in a professional setting. Every month, I will share performance vs. benchmark indices, most suitable to asset allocation, highlights of the strongest and weakest performance, and any changes I have made to my portfolio. This is not about sugarcoating results. Since I genuinely want to improve, there is no point in trying to sweet talk mistakes and slip-ups. Over time, this series should build a narrative of my investing journey, through wins, theses, and most importantly long-term performance and improvement. My daily commentary usually serves as an opinion piece on companies on my watchlist or the most recent macro news, while these monthly recaps are intended to provide a comprehensive guide on my investing principles and execution.

Portfolio Performance

For the month of August, my portfolio delivered a strong +5.25% total return. Not a bad start for month one, but it is always important to remember that short-term gains are not the most meaningful metric. Consistency is key. Nevertheless, to put this month’s return in perspective, here are important benchmarks:

S&P 500: +3.33%
Nasdaq 100: +2.42%
MSCI ACWI: +3.84%

This means the portfolio outperformed both global and U.S. benchmarks in its first full month, which is encouraging.

However, the performance was not linear. The first few days were negative, but as the month progressed, companies reported earnings and news surfaced, several key holdings – particularly those in healthcare and fintech – drove strong upward momentum. This led to an intersection between my portfolio performance and benchmarks around the middle of the month. Since then, the portfolio has outpaced the market’s broader rally.

The outperformance cannot be attributed to one single stock, but rather a combination of multiple holdings reacting strongly. This is exactly how I want my portfolio to behave: diversified enough to avoid cluster risk, but concentrated enough to benefit meaningfully from each of my highest-conviction ideas. It is crucial to strike the balance between diversification and conviction, without sacrificing returns or risk management.

Allocation Snapshot

The portfolio currently consists of 18 equity holdings plus cash, with cash representing the single largest allocation at 35.1%.

This is a short breakdown of my portfolio:

Cash: 35.1%
Largest equity holding: Eli Lilly (LLY) at 5.5%
Other top allocations include: UNH (4.8%), ASML (4.6%), SLB (4.6%), DLocal (4.2%), Dynatrace (4.1%), Gambling.com (4.1%), Salesforce (4.0%), Novo Nordisk (3.9%), and Nu (3.7%).

The high cash balance is intentional. As this is the first month of the portfolio, it is important not to rush into not-well-enough researched positions only to reduce the cash quota. Even for my highest-conviction positions, like LLY or ASML, I want to remain disciplined with entry prices and only buy on pullbacks, after I initiate my first tranche. As I emphasized in my last report, I aim to invest opportunistically in great companies at discounts, and reduce my cash balance to below 10% by the end of the year. In fact, over the course of August I already reduced my cash position from 56% to 35%, by adding to and opening new positions, especially during the first half of the month.

However, I am not in a rush to close my cash holding right now, since I am convinced that this rally off the April lows is highly unsustainable, considering the economic tensions and tariff regime in place. AI hype is driving this rally, and if the enthusiasm cools down, some interesting opportunities could present.

Since I aim for high returns with acceptable risk management, the exposure to fast-growing industries like fintech and software comes naturally. However, I also own more defensive players in the energy and healthcare spaces that, in my opinion, offer a healthy risk/reward ratio not recognized enough by the market. Indeed, some of the companies I hold fall on the more expensive spectrum, but they also boast immense growth and potential for the future. My focus does not lie on momentum or trends, but rather fundamentals and underlying prospects.

Strongest & Weakest Performers

Strongest performers:

DLocal posted strong earnings in a volatile market environment, which led to a jump in the stock of more than 40% the day after. I remain extremely bullish on the company, with a forward P/E ratio of 23, reflecting a more than fair valuation even after the recent rally. The fintech disruptor is revolutionizing payment solutions across emerging markets, with still a massive TAM left.

UnitedHealth recovered more than 30% from the lows hit at the beginning of the month, due to improving sentiment and the news of several super-investors, most notably Buffett’s Berkshire Hathaway, opening a position in the healthcare giant. The company has a very healthy balance sheet and a strong moat as the largest health insurer worldwide, and that is not even taking into account all its other ventures.

Nubank outperformed on strong user growth (over 127 million customers across Latin America) and rising profitability. As the leading neobank in Latin America, Nu delivers >25% annual growth and holds a stellar position. The TAM is hard to overlook, as the neobank operates in one of the most underbanked regions worldwide.

Weakest performers:

Salesforce slightly recovered from recently hit lows, while still underperforming the broader tech sector due to a perceived lack of AI implementation. However, Salesforce is the largest provider of CRM services worldwide and in a very good position for a recovery if any good news hits. The company has not taken part in the recent rally and could be in for a rebound.

Gambling.com sold off after solid earnings due to a cautious outlook. Online betting is inherently cyclical, and the current economic situation does not look great. However, Gambling.com is already trading at an extremely cheap valuation. Somehow, the market still finds a way to send the stock further down.

In both cases, I view the weakness as sentiment-driven rather than structural. Investors’ confidence is shattered at the moment. However, my theses on these companies have not changed. I think both of them are misunderstood and victims of short-term focus, rather than the broader picture.

Portfolio Activity

Because this was the first month, most activity was centered around building initial positions. I deliberately capped position sizes at ~3–5% each, which allows me to add more over time if conviction grows or valuations improve.

New Buys: SLB, FTNT, DT, CDLR
Adds: CRM, GAMB, LLY, UNH
Sells: M12
Cash: Meaningfully reduced from >55% to ~35%

My portfolio is still “under construction.” While I reduced my cash position and invested aggressively, especially after earnings hit, I still hold a significant chunk of my portfolio in cash, which I plan to reduce by the end of the year. When I decide to buy into a company, I always do it in tranches and build a position over time, rather than buying all at once. Take Lilly for example: I opened an initial position in July and then bought multiple times this month after the earnings-related dip, and now I am almost 10% in the green with the position.

Market & Macro Context

Markets in August were shaped mainly by speculation around interest rate cuts and the earnings season, both of which contributed positively to my return. Several of my holdings jumped after stellar earnings, while others fell and therefore created opportunities to add, increasing long-term upside. Economic data was two-edged: while unemployment continued to increase, so did GDP, and tariff impacts were largely absorbed by corporations. My portfolio specifically profited from improving sentiment around some beaten-up healthcare names and increasing momentum for fintech and Latin American stocks. August has also been a good month for many tech investors due to continued growth and AI momentum.

Outlook

September historically is a very difficult month for markets. These are the key catalysts I will be looking at over the next month:

Jerome Powell has hinted at a possible rate cut at the next meeting, which the market has now priced in. It seems likely, at this point, that interest rates will be falling. However, if the Fed has a sudden change of heart, it could mean a cold awakening for stocks across the board.

On the other hand, if the most likely scenario – a rate cut – comes in, the already started shift from tech stocks to more cyclical industries profiting from lower interest rates could get a boost in September.

Apart from that, I still wholeheartedly believe that the current recovery rally from April lows is highly unsustainable and will eventually cool down, which could create buying opportunities. Whether that will be in September or a later month, I cannot determine. However, it seems strange to have such bullish sentiment ruling the markets, considering the tariff-inflicted strain on the economy. If signs of a cooling cycle thicken, markets could tumble very quickly.

Nevertheless, I am not worried about a broader pullback, since conviction is unwavering for the holdings in my portfolio. If anything, selloffs create possibilities to add to existing holdings or initiate new positions at attractive entry prices.

Closing Thoughts

This first month has been a promising start, with outperformance vs. benchmarks, and multiple adds to my highest-conviction positions. My strategy of investing opportunistically has proven correct so far. However, it has only been one month and I understand that markets fluctuate, which means that patience is key. While it is tempting to deploy cash all at once in order to ride the rally, that is not how I play the game.

In my daily comments I talked about many companies on my watchlist, some of which I will probably never own, because they do not reach my entry prices. That is not important. I have my eyes on countless stocks and continue to research new companies every day. There are always opportunities in the market, and often they are the ones most under fire.

Furthermore, I look forward to continuing this series monthly. Transparency, accountability, and consistency are the main goals. I strive to be the best investor I can possibly be, and this is my log. The target is as clear as ever: beating the market consistently and transforming that experience into the real world.

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$DT (+2,57%)
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+ 5

2 Commenti

1Anno

How are you creating these graphs?

••

Mostra la risposta

Konstantin A. Harrer

@KA_Harrer

1Anno·

Aug 8 / Pressure, Diversification and a Close Call

Trump Targets Intel ($INTC (+7,53%) )

The president really can’t live a day without making new headlines. This time, it will either cost Intel’s former great hope his head, or the company’s favor with Trump. Intel CEO Lip-Bu Tan clawed back at Trump after he accused him of being “highly conflicted” and called for his immediate resignation, due to Tan’s involvement and investments in some Chinese firms.

As of now, Intel’s board stands with their CEO, but it’s uncertain for how long, considering how persistent the president can be at times.

New Buy: Dynatrace ($DT (+2,57%) )

Let’s talk about something more wholesome. I added a new holding to my portfolio today. Dynatrace, originally founded in Austria, is a venture capital success story with an extremely sticky business model. Dynatrace uses advanced AI models to flag and fix flaws in IT systems automatically, before its customers even notice.

It essentially works as a control room for large companies with complex, cloud-based IT structures. Importantly, Dynatrace’s applications are deeply embedded into clients’ systems, which makes it very hard to switch without disruption (therefore, very sticky). These services are offered as a subscription model, leading to recurring revenue and high margins for Dynatrace, which invests heavily in expanding its AI models to stay ahead of the competition. This is a very interesting buy – expect a detailed analysis soon.

Dodged a Bullet: Redwire ($RDW (+4,97%) )

I have a passion for innovative defense companies. Seriously, I find them fascinating, which unfortunately makes me more inclined to hop on a train rolling straight to Neverland. Last week, I was very close to buying into Redwire’s space infrastructure story.

Ultimately, I didn’t, due to slight valuation concerns and high volatility. And, thank goodness, I was able to control myself. The company reported earnings on Wednesday, and they were bad – really bad. Redwire completely missed expectations on every metric possible, slashed guidance, and waffled about unexpected costs.

After such a horrific report and a disillusioning call, I would have sold and taken a heavy loss. Often, it’s better to keep emotions and personal interests out of investment decisions.

08.08

Dynatrace

Acquistato x130 a 47,25 USD

6.142,50 USD

ThemenmitKopf

@topicswithhead

2Anno·

Datadog- The pitbull of data analysis or just 3rd class after all

Company presentation

Datadog and Dynatrace are two of the leading companies in the field of cloud monitoring and observability solutions.

$DDOG (+4,01%) Datadog, founded in 2010 and based in New York City, offers a SaaS-based data analytics platform that monitors a wide range of IT infrastructure components - from servers and databases to tools and services - across a cloud environment.

$DT (+2,57%) is also an American company that specializes in software intelligence platforms. It provides comprehensive solutions for monitoring application performance, infrastructure and user experience.

Historical development

Datadog has experienced impressive growth since its foundation:

- 2015: Completion of a Series C financing round that supported expansion into new markets and further development of the product range.

- Continuous expansion of the platform, especially log management and application performance monitoring

- 2020: Acquisition of Undefined Labs to strengthen testing and observability capabilities.

Dynatrace has also undergone a remarkable development, although concrete milestones are not specified in the available information.

Business model and core competencies

Datadog:

- Offers a cloud-based platform for comprehensive monitoring.

- Core competencies: Infrastructure monitoring, application performance monitoring, log management, user experience monitoring and security monitoring.

- Focuses on continuous innovation and customization.

Dynatrace:

- Provides a comprehensive end-to-end observability solution.

- Core competencies: Unified platform for observability, security and business data.

- Focuses on automated provisioning and AI-supported analyses.

Future prospects and strategic initiatives

Both companies focus on continuous innovation and the expansion of their product portfolios in order to meet rapidly changing technologies and customer requirements.

Datadog has accelerated the development of new products and doubled the number of its paid solutions within the last year.

Dynatrace is focused on further developing its AI-powered analytics tools and optimizing the automated deployment of its solutions.

Market position and competition

In a dynamic and highly competitive market in which companies such as $SPLK (in the $CSCO (+3,49%) acquisition), New Relic, Elastic and Hyperscaler are also active, both companies are competing for the leading position.

Datadog is recognized as the market leader for its integrated full-stack monitoring solutions.

Dynatrace is positioned as a leader in end-to-end observability with a particular focus on AI-powered solutions.

Market potential (Total Addressable Market, TAM)

Although exact TAM figures are not provided, it is clear that both companies are operating in a rapidly growing market for cloud monitoring and observability solutions, which is being driven by the increasing digital transformation in various industries.

Share performance

Datadog:

- 1-year performance: 5.7%

- TR since the IPO on 19.09.2019:186.83%

- Currently 19.90% below the 52-week high and 45.61% above the 52-week low.

- 84% of analysts recommend the share as a buy (60% "Strong Buy", 24% "Buy").

Dynatrace:

- 1-year performance: 5, %

- TR since the IPO on 01.08.2019 : 113.42%

- Currently 16.99% below the 52-week high and 28.76% above the 52-week low.

- 77 % of analysts recommend the share as a buy (57 % "Strong Buy", 20 % "Buy").

Despite short-term fluctuations, both companies are performing positively overall.

Development

Both companies are recording continuous sales growth, with Datadog showing significantly stronger growth momentum than Dynatrace. As a result, Datadog's turnover is currently around one billion US dollars higher than that of Dynatrace. Nevertheless, the growth rates of both companies are still impressive and are expected to remain at a high level in the coming years.

Looking at the distribution of sales by country, it is clear that Datadog concentrates its sales heavily on North America, while Dynatrace is much better diversified internationally.

Despite this difference in geographic focus, Datadog's focus on North America could be seen as a strategic advantage, as the data business in the US is generally more valuable than in many international markets. The strong foothold in North America provides Datadog with a solid foundation to capitalize on the high demand and lucrative business opportunities in the region.

Internationalization should not be difficult for Datadog due to its existing successful model. With its proven product range and high level of innovation, the company is well positioned to gain a foothold on a global level and grow in other markets.

As with sales, Datadog's gross profit is also higher than that of Dynatrace. The gross margins of both companies are almost the same, although Dynatrace had a higher margin at the beginning.

The Annual Recurring Revenue (ARR) of Datadog is currently twice as high as that of Dynatrace, which underlines Datadog's strong growth momentum and market position.

A higher ARR means that Datadog is able to grow recurring revenue faster and effectively leverage long-term customer relationships. This growth may have been driven by successful expansion into new markets and the introduction of additional products and services. A high ARR is also a sign of strong demand and high customer satisfaction, which could be due to the broad offering and versatility of the Datadog platform.

Dynatrace, although also with solid growth rates and a stable ARR, remains smaller compared to Datadog. Nevertheless, it shows that both companies have strongly focused their business models on recurring revenues, which is an important indicator of sustainable growth and financial stability in a competitive market.

Despite the smaller revenues, it shows that Dynatrace has a better EPS than Datadog.

FCF is positive for both

Part 2: https://getqu.in/wuxnDJ/

+ 6

ThemenmitKopf

@topicswithhead

2Anno·

Datadog- The pitbull of data analysis or just 3rd class after all

Part 1:https://getqu.in/YpHawB/

The stock-based compensation (stock-based compensation) has grown faster at $DT (+2,57%) has grown faster than at Datadog, but the absolute volume of stock-based compensation at Datadog is currently twice as high. This shows that $DDOG (+4,01%) Dynatrace is relying more heavily on granting share options to employees in order to attract and retain talent - a strategy that is particularly widespread in the technology sector.

At Dynatrace, share-based remuneration is also increasing, but the company has already started to buy back shares from time to time

The net debt / EBITDA is negative for both, but even better for datadog

According to the EV/EBITDA multiple (Enterprise Value to EBITDA), Dynatrace is currently more attractively valued than Datadog, but in this case the attractiveness of Dynatrace according to EV/EBITDA is less meaningful in the current comparison. This is due to the fact that both companies are in different growth phases and with different strategic priorities. Datadog is investing aggressively in growth and expansion, which leads to a higher EV/EBITDA multiple, while Dynatrace is pursuing a more profitability-oriented approach and thus appears more attractive in this ratio.

In terms of capital efficiency, Dynatrace has performed much better in the recent past. The company has apparently been able to utilize its resources more effectively and achieve a better return on capital employed. However, capital efficiency has not yet been the main focus for either company.

If both companies were to focus more on optimizing their capital efficiency, it is likely that Datadog would end up outperforming due to its faster growth momentum and market strategy to date. Datadog has shown that it is willing to invest in its future development to further extend its market leadership. If the company combines this growth strategy with a stronger focus on capital efficiency, it could further consolidate its position.

Therefore, one should not yet attach too much importance to current capital efficiency.

Conclusion

Looking at the remaining providers in the observability and cloud monitoring market, it is clear that apart from the large hyperscalers such as $AMZN (-1,28%) , $MSFT (-2,14%) and $GOOGL (+2,42%) which nevertheless need to be mentioned here, only a few specialized companies remain. $SPLK would be very interesting in this context, but is currently in the process of being acquired by Cisco, which is why it is not included in this comparison.

Of the remaining providers, Dynatrace and Datadog stand out in particular. Although the two companies do not offer exactly the same solutions, they have significant overlaps in their service offerings.

Both companies entered the market almost simultaneously and went public at around the same time. Nevertheless, Datadog has developed much more dynamically than Dynatrace since then. The founders of Datadog are still heavily involved in the company and still hold significant shares, which is a sign of long-term confidence in the company and its growth strategy.

Another decisive argument is Datadog's strong focus on research and development. Datadog invests almost half of its turnover in R&D (Research & Development) in order to continuously improve its products, create more added value for customers and secure and expand its market position. This consistent approach to innovation has already borne fruit and is reflected in the company's impressive growth rate.

Although both companies are on a par in many metrics, I see Datadog as the "Dawg in the house". Another advantage of Datadog is its independence and flexibility, which allows it to focus specifically on its core business - unlike the large hyperscalers, which are less agile due to their extensive and often complex structures.

In addition, many customers value Datadog's independence from the large cloud providers. In a market where hyperscalers already dominate the infrastructure, Datadog's focus on monitoring in the cloud is a convincing differentiation. Customers prefer independent providers that are not dependent on their own strategy and have the expertise to focus on a specific area.

All in all, these factors suggest that Datadog is in a strong position to continue to grow and consolidate its place as market leader, despite the challenges posed by hyperscalers.

+ 5

Bastian Gahleitner

@diamondFingerBG

4Anno·

Has anyone heard of $DT (+2,57%) and can give me info?

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