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Datadog (DDOG) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Datadog (DDOG - Free Report) closed at $113.29, marking a -0.23% move from the previous day. This change lagged the S&P 500's 0.15% loss on the day. Meanwhile, the Dow lost 0.07%, and the Nasdaq, a tech-heavy index, lost 0.47%.

Coming into today, shares of the data analytics and cloud monitoring company had gained 27.04% in the past month. In that same time, the Computer and Technology sector gained 6.24%, while the S&P 500 gained 3.19%.

DDOG will be looking to display strength as it nears its next earnings release. Meanwhile, our latest consensus estimate is calling for revenue of $144.24 million, up 50.47% from the prior-year quarter.

DDOG's full-year Zacks Consensus Estimates are calling for earnings of $0.13 per share and revenue of $570.60 million. These results would represent year-over-year changes of +1400% and +57.29%, respectively.

It is also important to note the recent changes to analyst estimates for DDOG. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 80.95% lower within the past month. DDOG is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that DDOG has a Forward P/E ratio of 904.38 right now. For comparison, its industry has an average Forward P/E of 89.96, 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 167, which puts it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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