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  5. ESTC: Hi, Looking to switch nvei to one of the above. [Elastic N.V.]
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Q: Hi,
Looking to switch nvei to one of the above. Which would you choose?

Thanks
Asked by sean on March 11, 2024
5i Research Answer:

 Both are decent software businesses. That said, ESTC is still operating at EBIT loss, and growth slowed down moderately in recent years (growth in the most recent quarter was 19%, compared to previous years of more than 30%). That said we like ESTC and if profitability and cash flow improve meaningfully from here the stock could do very well. For now, we would go for LMN.V due to the track record of value creation from CSU’s guidance. In addition, LMN acquires profitable, cash flow generative software busiensses, which we think have good prospects overall.

Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in ESTC.

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