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Datadog (DDOG) Outpaces Stock Market Gains: What You Should Know

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Zacks Equity Research
·3 min read
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In the latest trading session, Datadog (DDOG) closed at $99.31, marking a +0.39% move from the previous day. This move outpaced the S&P 500's daily gain of 0.13%. At the same time, the Dow added 0.24%, and the tech-heavy Nasdaq gained 0.15%.

Prior to today's trading, shares of the data analytics and cloud monitoring company had gained 3.4% over the past month. This has lagged the Computer and Technology sector's gain of 4.54% and outpaced the S&P 500's gain of 2.59% in that time.

DDOG will be looking to display strength as it nears its next earnings release. On that day, DDOG is projected to report earnings of $0.01 per share, which would represent a year-over-year decline of 66.67%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $163.32 million, up 43.72% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.17 per share and revenue of $589.34 million, which would represent changes of +1800% and +62.45%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for DDOG. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. DDOG is currently sporting a Zacks Rank of #4 (Sell).

Valuation is also important, so investors should note that DDOG has a Forward P/E ratio of 567.06 right now. For comparison, its industry has an average Forward P/E of 79.73, which means DDOG is trading at a premium to the group.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 195, which puts it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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