For those who appreciate growth without the sticker shock, NYSE:DT is worth considering.

Last update: Mar 1, 2024

Take a closer look at DYNATRACE INC (NYSE:DT), an affordable growth stock uncovered by our stock screener. NYSE:DT boasts strong growth prospects and excels in financial health indicators, all while maintaining a reasonable valuation. Let's break it down further.

Looking at the Growth

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NYSE:DT boasts a 9 out of 10:

DT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 47.56%, which is quite impressive.
Measured over the past years, DT shows a very strong growth in Earnings Per Share. The EPS has been growing by 65.28% on average per year.
Looking at the last year, DT shows a very strong growth in Revenue. The Revenue has grown by 24.39%.
Measured over the past years, DT shows a very strong growth in Revenue. The Revenue has been growing by 23.82% on average per year.
Based on estimates for the next years, DT will show a very strong growth in Earnings Per Share. The EPS will grow by 20.42% on average per year.
The Revenue is expected to grow by 18.91% on average over the next years. This is quite good.

What does the Valuation looks like for NYSE:DT

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NYSE:DT has earned a 5 for valuation:

DT's Price/Earnings ratio is a bit cheaper when compared to the industry. DT is cheaper than 69.82% of the companies in the same industry.
DT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. DT is cheaper than 65.45% of the companies in the same industry.
Based on the Enterprise Value to EBITDA ratio, DT is valued a bit cheaper than the industry average as 68.00% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, DT is valued a bit cheaper than 69.09% of the companies in the same industry.
DT's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of DT may justify a higher PE ratio.
DT's earnings are expected to grow with 17.61% in the coming years. This may justify a more expensive valuation.

Assessing Health Metrics for NYSE:DT

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NYSE:DT has earned a 7 out of 10:

DT has an Altman-Z score of 8.68. This indicates that DT is financially healthy and has little risk of bankruptcy at the moment.
DT's Altman-Z score of 8.68 is amongst the best of the industry. DT outperforms 82.55% of its industry peers.
There is no outstanding debt for DT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

Evaluating Profitability: NYSE:DT

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:DT has earned a 7 out of 10:

The Return On Assets of DT (6.57%) is better than 86.55% of its industry peers.
The Return On Equity of DT (10.29%) is better than 86.18% of its industry peers.
The Return On Invested Capital of DT (4.49%) is better than 77.82% of its industry peers.
The 3 year average ROIC (3.89%) for DT is below the current ROIC(4.49%), indicating increased profibility in the last year.
DT has a better Profit Margin (14.44%) than 86.18% of its industry peers.
DT's Profit Margin has improved in the last couple of years.
DT has a Operating Margin of 9.16%. This is in the better half of the industry: DT outperforms 80.00% of its industry peers.
The Gross Margin of DT (81.36%) is better than 86.91% of its industry peers.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of DT

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.