TD Cowen Lowers Elastic (ESTC) Price Target to $85, Maintains Hold

Elastic N.V. (NYSE:ESTC) is one of the AI Stocks Hit with New Analyst Ratings. On August 26, TD Cowen analyst Andrew Sherman lowered the price target on the stock to $85.00 (from $90.00) while maintaining a Hold rating. The lower price target comes ahead of the company’s print due on August 28.

The firm has updated its model ahead of its quarterly results, anticipating a beat and raise. Moreover, given the new CFO, the company will likely guide conservatively.

“Expecting Modest Beat & Raise; ESTC reports on 8/28. We expect a beat & raise given new CFO likely guided conservatively. Our partner checks remain mixed, citing fine renewals but competitive factors & AI risks. Our partner survey down-ticked w/ 67% met/beat vs. 86% last qtr, though pipelines looked better. At 4.3x EV/Sales we see low expectations but a return to Cloud upside is needed."

"Shares are -14% since reporting 4Q (IGV +5%). Sentiment seems relatively bearish & valuations at ~4.3x EV/CY26E Sales & ~20x EV/FCF shares trade at a discount to 10-15% comps at ~5x. Reiterate Hold & lower PT to $85 (~4.5x EV/CY26E Sales).”

Elastic N.V. is a search AI company offering cloud-based solutions.

While we acknowledge the potential of ESTC as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on thebest short-term AI stock.

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Disclosure: None.