Elastic: AI Resistant, Strong Growth, And Great Value

Gary Alexander33.53K FollowersFollow5ShareSavePlay(9min)CommentsSummaryElastic remains fundamentally strong despite a ~30% YTD decline and sector-wide SaaS selloff.ESTC's consumption-based pricing model and 112% net retention rate insulate it from AI-driven layoffs and churn.AI trends may serve as a tailwind for ESTC, supporting its complex, developer-focused search platform.With high-teens growth and margins, ESTC trades at just 2.3x FY27 EV/revenue, making the current dip a buying opportunity. J Studios/DigitalVision via Getty Images As all attention in the stock market is centered around the possible escalation of tensions in Iran, investors have retained the risk-off attitude that has dominated the stock market this year, in particular hitting small- and mid-cap growth stocks hard. The "SaaSpocalypse" narrative continues to weighThis article was written byGary Alexander33.53K FollowersFollowWith combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on Seeking Alpha since 2017. He has been quoted in many web publications and his articles are syndicated to company pages in popular trading apps like Robinhood.Analyst’s Disclosure: I/we have a beneficial long position in the shares of ESTC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.