Rosenblatt Securities on Friday lowered its price target for Elastic N.V. (NYSE:ESTC) to $110.00 from $130.00, while continuing to rate the enterprise search company as a Buy. The brokerage cited recent comparable multiple compression across the sector and lingering macroeconomic headwinds as the principal reasons for trimming the target.
Elastic's shares are trading at $67.72, a decline of nearly 39% over the past 12 months and only a few dollars above the 52-week low of $65.39. Rosenblatt's adjustment comes against that backdrop, even as some valuation metrics highlighted by third-party data show the stock trading below its Fair Value assessment.
Valuation and balance sheet
Rosenblatt pointed to comparable multiple compression as the main driver for the reduced target. Separately, InvestingPro data referenced by the firm suggests Elastic may appear undervalued versus its Fair Value assessment. That data also underscores the company’s solid financial position, including having more cash than debt on its balance sheet, a detail the firm views as supportive amid uncertain macro conditions.
Near-term reporting expectations
The brokerage expects Elastic to report third-quarter fiscal 2026 results for the period ending January 31 in late February that are in-line with, or slightly better than, current expectations. Rosenblatt’s forecast reflects cautious optimism: the lowered price objective accounts for sector valuation pressure, while the firm still anticipates operational results that meet or modestly exceed consensus.
Product advances and strategic positioning
Rosenblatt highlighted several recent product developments as positives for Elastic’s future growth prospects. The firm noted the general availability release of Agent Builder last week and pointed to a prior realignment of Elastic’s sales organization to emphasize higher-value customers. Rosenblatt sees these moves as supportive of longer-term adoption and revenue quality.
Additional company disclosures cited in the review include enhancements to Elastic’s Cloud Serverless offering on Amazon Web Services. Elastic reported achieving up to a 50% increase in indexing throughput and a 37% reduction in search latency through the use of AWS Graviton instances, while keeping pricing unchanged. The company also received an AWS Agentic AI Specialization and announced an integration for Amazon Bedrock AgentCore to enable monitoring and troubleshooting of AI agents via the Elasticsearch platform.
Other analyst action
In a separate update, DA Davidson reduced its price target on Elastic to $80 from $100 and maintained a Neutral rating. DA Davidson cited mixed growth trends and a slowdown in cloud growth as the rationale behind its more conservative outlook.
Outlook
Rosenblatt continues to view Elastic as positioned to benefit from consolidation trends in log management, modernization of legacy security information and event management (SIEM) systems, and the emergence of AI and agentic applications that leverage Elastic’s Search Relevance Engine and vector database capabilities. Nonetheless, the reduced price target signals the analyst community’s caution in translating those strategic advantages into near-term valuation improvements amid broader market pressures.