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Datadog (DDOG) Registers a Bigger Fall Than the Market: Important Facts to Note

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Datadog (DDOG - Free Report) closed the most recent trading day at $139.98, moving -5.98% from the previous trading session. This move lagged the S&P 500's daily loss of 0.37%. Meanwhile, the Dow lost 0.74%, and the Nasdaq, a tech-heavy index, lost 0.03%.

Shares of the data analytics and cloud monitoring company witnessed a gain of 10.27% over the previous month, beating the performance of the Computer and Technology sector with its gain of 4.58%, and the S&P 500's gain of 2.68%.

The upcoming earnings release of Datadog will be of great interest to investors. The company's earnings report is expected on August 7, 2025. 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%. At the same time, our most recent consensus estimate is projecting a revenue of $790.78 million, reflecting a 22.55% rise from the equivalent quarter last year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $1.7 per share and revenue of $3.23 billion, which would represent changes of -6.59% and +20.47%, respectively, from the prior year.

Investors should also note any 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 demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.6% higher. Datadog is currently a Zacks Rank #2 (Buy).

In terms of valuation, Datadog is presently being traded at a Forward P/E ratio of 87.61. This expresses a premium compared to the average Forward P/E of 28.48 of its industry.

One should further note that DDOG currently holds a PEG ratio of 10.86. 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 2.18 as trading concluded yesterday.

The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 73, placing it within the top 30% of over 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.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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