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Datadog (DDOG) Rises Higher Than Market: Key Facts

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Datadog (DDOG - Free Report) closed at $138.81 in the latest trading session, marking a +1.05% move from the prior day. The stock's change was more than the S&P 500's daily gain of 0.14%. Elsewhere, the Dow saw an upswing of 0.2%, while the tech-heavy Nasdaq appreciated by 0.27%.

Shares of the data analytics and cloud monitoring company have appreciated by 14.05% over the course of the past month, outperforming the Computer and Technology sector's gain of 5.36%, and the S&P 500's gain of 3.97%.

Analysts and investors alike will be keeping a close eye on the performance of Datadog in its upcoming earnings disclosure. In that report, analysts expect Datadog to post earnings of $0.41 per share. This would mark a year-over-year decline of 4.65%. Simultaneously, our latest consensus estimate expects the revenue to be $789.55 million, showing a 22.36% escalation compared to the year-ago quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.7 per share and revenue of $3.23 billion. These totals would mark changes of -6.59% and +20.47%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Datadog. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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. The Zacks Consensus EPS estimate remained stagnant within the past month. Datadog currently has a Zacks Rank of #4 (Sell).

From a valuation perspective, Datadog is currently exchanging hands at a Forward P/E ratio of 81.04. This expresses a premium compared to the average Forward P/E of 27.71 of its industry.

Meanwhile, DDOG's PEG ratio is currently 10.04. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Internet - Software industry was having an average PEG ratio of 2.15.

The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 65, placing it within the top 27% of over 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.

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


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