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Why Elastic (ESTC) Is Down 5.5% After Landing CISA’s Unified Federal SIEMaaS Contract - And What's Next

Simply Wall St · 2d ago
  • Elastic N.V. previously announced a partnership with the Cybersecurity and Infrastructure Security Agency (CISA) and ECS to build a unified, FedRAMP-certified SIEM-as-a-Service platform on Elastic Cloud for U.S. Federal Civilian Executive Branch agencies, under a US$26.00 million base-year contract that could reach up to US$130.00 million over five years.
  • The collaboration positions Elastic at the center of a government-wide cybersecurity modernization effort, potentially deepening its role in large-scale security, observability, and data analytics workloads across federal agencies.
  • Next, we’ll examine how anchoring CISA’s unified SIEMaaS platform on Elastic Cloud could reshape Elastic’s investment narrative around federal sector expansion.

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Elastic Investment Narrative Recap

To own Elastic, you need to believe its search and AI platform can keep gaining share in security, observability, and data analytics, especially in the cloud. The new CISA SIEMaaS contract reinforces Elastic’s credibility in high-stakes federal security, but does not by itself remove the short term risk that slower billings growth and rising competition from hyperscalers could keep pressuring sentiment and limit upside from execution improvements.

Among recent updates, Elastic’s Q3 FY2026 and full year FY2026 guidance for mid-teens revenue growth is the most relevant context for this CISA win, because it frames how quickly large cloud and security deployments might translate into reported revenue. Investors may watch whether this federal SIEMaaS rollout, alongside broader cloud adoption, can offset pricing and commoditization pressure in search and security analytics.

Yet even as federal demand strengthens, investors should also be aware of the risk that hyperscaler native services could still...

Read the full narrative on Elastic (it's free!)

Elastic’s narrative projects $2.3 billion revenue and $50.5 million earnings by 2028.

Uncover how Elastic's forecasts yield a $106.22 fair value, a 43% upside to its current price.

Exploring Other Perspectives

ESTC 1-Year Stock Price Chart
ESTC 1-Year Stock Price Chart

Six fair value estimates from the Simply Wall St Community span about US$89.66 to US$140.57 per share, showing how far apart individual views can be. Against that spread, the risk that hyperscale cloud providers could squeeze Elastic’s market share and pricing gives you a concrete factor to weigh as you compare these different opinions.

Explore 6 other fair value estimates on Elastic - why the stock might be worth just $89.66!

Build Your Own Elastic Narrative

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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.