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Datadog (DDOG) Gains As Market Dips: What You Should Know

Datadog (DDOG) closed the most recent trading day at $88.78, moving +1.52% from the previous trading session. This move outpaced the S&P 500's daily loss of 1.51%. Elsewhere, the Dow lost 1.71%, while the tech-heavy Nasdaq lost 0.02%.

Prior to today's trading, shares of the data analytics and cloud monitoring company had lost 9.98% over the past month. This has was narrower than the Computer and Technology sector's loss of 11.76% and lagged the S&P 500's loss of 9.52% in that time.

Investors will be hoping for strength from Datadog as it approaches its next earnings release. On that day, Datadog is projected to report earnings of $0.16 per share, which would represent year-over-year growth of 23.08%. Our most recent consensus estimate is calling for quarterly revenue of $412.61 million, up 52.54% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.78 per share and revenue of $1.62 billion, which would represent changes of +62.5% and +57.75%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Datadog. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 2.14% lower within the past month. Datadog is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note Datadog's current valuation metrics, including its Forward P/E ratio of 111.83. For comparison, its industry has an average Forward P/E of 44.79, which means Datadog is trading at a premium to the group.

It is also worth noting that DDOG currently has a PEG ratio of 2.65. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software industry currently had an average PEG ratio of 2.35 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 93, putting it in the top 37% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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