Here's Why Datadog (DDOG) Fell More Than Broader Market
Datadog (DDOG) closed the most recent trading day at $121.38, moving -1.54% from the previous trading session. The stock's performance was behind the S&P 500's daily loss of 0.28%. Meanwhile, the Dow experienced a drop of 0.06%, and the technology-dominated Nasdaq saw a decrease of 0.56%.
Shares of the data analytics and cloud monitoring company have appreciated by 5.76% over the course of the past month, outperforming the Computer and Technology sector's gain of 4.68% and the S&P 500's gain of 5.24%.
The upcoming earnings release of Datadog will be of great interest to investors. On that day, Datadog is projected to report earnings of $0.43 per share, which would represent year-over-year growth of 65.38%. At the same time, our most recent consensus estimate is projecting a revenue of $566.7 million, reflecting a 20.73% rise from the equivalent quarter last year.
DDOG's full-year Zacks Consensus Estimates are calling for earnings of $1.53 per share and revenue of $2.11 billion. These results would represent year-over-year changes of +56.12% and +25.69%, respectively.
Investors should also take note of any recent adjustments to analyst estimates for Datadog. These recent revisions tend to reflect the evolving nature of short-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Currently, Datadog is carrying a Zacks Rank of #2 (Buy).
From a valuation perspective, Datadog is currently exchanging hands at a Forward P/E ratio of 80.69. Its industry sports an average Forward P/E of 40.02, so one might conclude that Datadog is trading at a premium comparatively.
One should further note that DDOG currently holds a PEG ratio of 2.83. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Software industry had an average PEG ratio of 1.81 as trading concluded yesterday.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 29, positioning it in the top 12% 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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Datadog, Inc. (DDOG) : Free Stock Analysis Report
