Dynatrace (DT): Evaluating Valuation Following New Amazon Bedrock AgentCore Integration

Dynatrace (DT) just made its new integration with Amazon Bedrock AgentCore available for AWS customers. This move puts Dynatrace ahead in supporting complex AI agent workflows. This development underscores the company’s focus on AI-driven observability and collaboration.

See our latest analysis for Dynatrace.

The share price tells a mixed story. While Dynatrace has lost nearly 19% year-to-date and its one-year total shareholder return is down over 21%, patient investors have still seen double-digit gains across three and five years. Recent momentum has faded slightly, but this strategic push into AI could help restore confidence and shift sentiment over the longer term.

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With shares trading nearly 39% below their average analyst price target and 39% below estimated intrinsic value, Dynatrace’s fundamentals raise a key question: is this an overlooked opportunity, or is the market already factoring in future AI-led growth?

Most Popular Narrative: 27.9% Undervalued

Dynatrace shares last closed at $44.17, well below the prevailing narrative’s fair value of $61.24. This sharp disconnect centers attention on whether investors are overlooking Dynatrace’s market momentum and business transformation.

The ongoing shift in the industry toward value-based, consumption-driven pricing models, with Dynatrace's DPS contracts now accounting for 65% of ARR and driving higher platform adoption and faster consumption, supports higher long-term revenue growth, improved customer lifetime value, and the potential for margin expansion.

Read the complete narrative.

What’s really fueling this surge in potential value? Analysts are betting on a combination of robust recurring revenue, innovative pricing, and sticky multi-product adoption. Dive into the details to discover which financial assumptions truly underpin this eye-catching valuation.

Result: Fair Value of $61.24 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition from hyperscalers and longer deal cycles could challenge Dynatrace’s growth trajectory. These factors could potentially limit upside if trends shift unexpectedly.

Find out about the key risks to this Dynatrace narrative.

Build Your Own Dynatrace Narrative

If you think there’s more to the story or want to dig into the numbers yourself, crafting a personal view takes just a few minutes. Do it your way.

A good starting point is our analysis highlighting 5 key rewards investors are optimistic about regarding Dynatrace.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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