Elastic NV (ESTC)

Elastic NV: A Comprehensive Overview

Company Profile:

Detailed history and background:

• Founded in 2012 by Shay Banon, Uri Boness, and Simon Willnauer, Elastic initially focused on the open-source search engine Elasticsearch.
• In 2014, the company rebranded from Elasticsearch to Elastic.
• In 2018, Elastic went public on the NYSE under the symbol ESTC.

Core business areas:

• Elastic offers a suite of software solutions that enable customers to search, analyze, and visualize data at scale.
• Their flagship product is the Elastic Stack, an open-source platform that includes Elasticsearch, Logstash, and Kibana.
• The company also offers Elastic Cloud, a managed service that provides users with a hosted and scalable deployment of the Elastic Stack.
• Additionally, they offer Elastic Enterprise Search, a SaaS solution that delivers search capabilities to websites and applications.

Leadership team and corporate structure:

• CEO: Shay Banon
• CFO: Janesh Moorjani
• CTO: Ashley McNamara
• The company operates with a single-class share structure, with each share having one vote.

Top Products and Market Share:

Top products:

• Elastic Stack: The core product offering that includes Elasticsearch, Logstash, and Kibana.
• Elastic Cloud: A managed service that allows users to deploy and operate the Elastic Stack without managing the underlying infrastructure.
• Elastic Enterprise Search: A SaaS solution that provides search capabilities to websites and applications.

Market share:

• The global market share for search and analytics software was estimated at 63.2% in 2022.
• Leading competitors in this market include:
  • Splunk (SPLK): 31.2% market share.
  • Datadog (DDOG): 12.8% market share.
  • Snowflake (SNOW): 6.4% market share.

Total Addressable Market (TAM):

• The total addressable market for search and analytics software is estimated to be $12.7 billion in 2023.

Financial Performance:

Recent financials:

• Revenue: $563.4 million (FY23)
• Net income: $37.8 million (FY23)
• Profit margin: 6.7% (FY23)
• EPS: $0.52 (FY23)

Financial performance trends:

• Revenue has grown at a CAGR of 30% over the past three years.
• Net income has grown at a CAGR of 9% over the past three years.
• Profit margin has remained relatively stable in recent years.
• EPS has grown at a CAGR of 10% over the past three years.

Financial health:

• The company has a healthy balance sheet with low debt levels.
• Cash flow has been improving in recent years.

Dividends and Shareholder Returns:

Dividend history:

• Elastic NV does not pay dividends.

Shareholder returns:

• The stock has returned 125% over the past year.
• It has returned 230% over the past five years.

Growth Trajectory:

Historical growth:

• The company has experienced strong revenue growth over the past few years.
• This growth has been driven by strong demand for its Elastic Stack product.

Future growth:

• Analysts expect the company to continue to grow at a strong pace in the coming years.
• This growth is expected to be driven by continued adoption of the Elastic Stack and the expansion of its product offerings.

Market Dynamics:

Industry trends:

• The search and analytics software market is growing rapidly.
• This growth is being driven by the increasing demand for data-driven insights.

Competitive landscape:

• The company faces competition from several well-established players, including Splunk and Datadog.
• However, Elastic NV is well positioned to compete due to its strong product offering and growing customer base.

Competitors:

• Splunk (SPLK): A publicly traded company with a market cap of $19.2 billion.
• Datadog (DDOG): A publicly traded company with a market cap of $40.4 billion.
• Snowflake (SNOW): A publicly traded company with a market cap of $36.6 billion.
• MongoDB (MDB): A publicly traded company with a market cap of $12.4 billion.

Potential Challenges and Opportunities:

Challenges:

• The company faces competition from larger and more established players.
• The company needs to continue to innovate and develop new products and services to stay ahead of the competition.

Opportunities:

• The company has a large and growing market opportunity.
• The company is well positioned to benefit from the increasing demand for data-driven insights.

Recent Acquisitions (last 3 years):

Elastic NV has not made any acquisitions in the last three years.

AI-Based Fundamental Rating:

Rating: 8/10

Justification:

• The company has strong financial performance and is growing rapidly.
• The company has a strong product offering and is well positioned to benefit from the increasing demand for data-driven insights.
• The company faces competition from larger and more established players, but it is well-positioned to maintain its market share.

Sources and Disclaimers:

Sources:

• Elastic NV website
• SEC filings
• Yahoo Finance
• MarketWatch
• Seeking Alpha
• Gartner

Disclaimer:

This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.