Reactions to earnings reports can sometimes be inconsistent and counterintuitive. Sometimes the market reacts one way and then changes its mind completely. When a company beats revenue and earnings estimates and raises guidance, the market is expected to push the stock higher, and vice versa when the company misses and heads lower. However, this is not always the case. Sometimes the market is wrong too, at least initially. Sometimes a price “gap” can trigger profit-taking, causing the company’s shares to “collapse” back. Here are two AI stocks in the Computer and Technology sector that have fallen and fallen, creating buying opportunities for bullish investors.
Elastic: AI-powered SIEM, data search and visualization for enterprises
Elastic today
(As of 12/11/2024 ET)
- 52 week range
- $69.00
▼
$136.06
- P/E ratio
- 194.55
- Target price
- $126.33
When companies need to enable search across various applications relevant to their data, Elastic HB New York Stock Exchange:ESTC is the data analytics provider of choice for brands such as the streaming giant Netflix Inc. NASDAQ: NFLX, eBay Inc. NASDAQ: EBAY, Uber Technologies Inc. New York Stock Exchange: UBER, Adobe Inc. NASDAQ: ADBE And Wells Fargo Inc. New York Stock Exchange: WFC. The artificial intelligence (AI) boom has also created a niche for Elastics, as it allows businesses to filter all kinds of data to determine which ones should be used to train AI. The company announced the Elastic AI Ecosystem for enterprise developers to accelerate the creation and deployment of augmented generation (RAG) applications.
Reducing Upper and Lower Estimates
Elastic reported second-quarter fiscal 2025 earnings per share of 59 cents, beating analysts’ consensus estimate of 38 cents by 21 cents. GAAP operating loss was $4 million, non-GAAP operating income was $64 million, and non-GAAP operating margin was 18%. Revenue rose 17.6% YoY to $365.36 million, well above the consensus estimate of $354.29. Elastic Cloud revenue grew 25% year over year to $169 million. Elastic ended the quarter with $1.2 billion in cash and cash equivalents.
Potential fiscal third quarter guidance and increased guidance for full fiscal year 2025
Elastic stock forecast today
$126.33
Growth potential 18.07%Moderate purchase
Based on ratings from 24 analysts
| High forecast | US$150.00 |
|---|---|
| Average forecast | $126.33 |
| Low forecast | $80.00 |
Elastic Stock Forecast Details
Elastic estimates Q3 2025 EPS growth potential of 46 cents to 48 cents vs. consensus estimate of 41 cents on revenue of $367 million to $369 million vs. consensus estimate of $366.04 million. Elastic expects For the full fiscal year 2025, earnings per share will be between $1.68 and $1.72, compared to previous forecasts of $1.52 and $1.56) vs. consensus estimate of $1.53.
Revenue expectations were raised to $1.451 billion to $1.457 billion from $1.436 billion to $1.444 billion, compared with the consensus estimate of $1.44 billion.
Elastic shares rose to $118.18 and fell to $108.03 after the earnings report.
NetApp: Building Intelligent Data Infrastructure for Multi-Cloud Enterprises
NetApp today
(As of 12/11/2024 ET)
- 52 week range
- $83.62
▼
$135.45
- Dividend yield
- 1.70%
- P/E ratio
- 22.55
- Target price
- $137.40
Whether on-premises, public or private cloud, NetApp Inc. NASDAQ: NTAP enables companies to support intelligent data infrastructure across hybrid cloud and public cloud segments. The company has won more than 100 contracts to modernize data lakes and AI, and has also expanded partnerships with Amazon.com Inc. NASDAQ:AMZNAWS and Alphabet Inc. NASDAQ: GOOGLE Google Cloud. Founded in 1992, it is one of the oldest mature IT companies benefiting from the artificial intelligence boom.
Strong growth for a mature technology company
NetApp reported second-quarter fiscal 2025 earnings per share of $1.87, beating the consensus estimate by 9 cents. Revenue grew 6.1% YoY to $1.66 billion, beating analysts’ estimates of $1.65 billion. Billing grew 9% YoY to $1.59 billion. The company recorded record annual net revenue from All-arrays. Flash at $3.8 billion, up 19% year-over-year. Revenue from cloud storage services on its own and marketplaces grew 43% year-over-year. NetApp ended the quarter with $2.22 billion in cash and cash equivalents.
Mixed Outlook: Current guidance for Q3 2025 and elevated EPS for FY 2025
NetApp stock forecast today
$137.40
Growth potential 12.02%Hold
Based on ratings from 17 analysts
| High forecast | US$160.00 |
|---|---|
| Average forecast | $137.40 |
| Low forecast | US$120.00 |
NetApp stock forecast details
NetApp issued current earnings per share guidance for the third quarter of 2025 of $1.85 to $1.94, versus the consensus estimate of $1.85. Revenue is expected to range from $1.61 billion to $1.76 billion, down from $1.68 billion.
Full-year fiscal 2025 earnings per share are expected to range from $7.20 to $7.40, versus consensus estimates of $7.11. Revenue is expected to range from $6.54 billion to $6.74 billion, versus the consensus estimate of $6.6 billion.
NetApp shares jumped to $135.45 and fell to $122.34 after the earnings report.
Before you consider Elastic, you should hear this.
MarketBeat tracks Wall Street’s top-rated and best-performing analysts daily and the stocks they recommend to their clients. MarketBeat identified five stocks that top analysts are quietly telling their clients to buy now before the broader market takes hold… and Elastic wasn’t on the list.
While Elastic currently has a Moderate Buy rating among analysts, the top-rated analysts think these five stocks are Strong Buys.
View five stocks here
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