Datadog (DDOG) Rises As Market Takes a Dip: Key Facts
In the latest trading session, Datadog (DDOG) closed at $264.48, marking a +1.58% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 0.22% for the day. Meanwhile, the Dow lost 0.03%, and the Nasdaq, a tech-heavy index, lost 0.66%.
The stock of data analytics and cloud monitoring company has fallen by 3.26% in the past month, lagging the Computer and Technology sector's loss of 2.58% and the S&P 500's loss of 1.21%.
The investment community will be closely monitoring the performance of Datadog in its forthcoming earnings report. The company is predicted to post an EPS of $0.58, indicating a 26.09% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.08 billion, up 30.22% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $2.41 per share and revenue of $4.34 billion, indicating changes of +17.56% and +26.62%, respectively, compared to the previous year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Datadog. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Based on our research, we believe these estimate revisions are directly related to near-term 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 last 30 days, the Zacks Consensus EPS estimate has moved 5.3% higher. Datadog currently has a Zacks Rank of #2 (Buy).
With respect to valuation, Datadog is currently being traded at a Forward P/E ratio of 107.87. For comparison, its industry has an average Forward P/E of 19.05, which means Datadog is trading at a premium to the group.
We can also see that DDOG currently has a PEG ratio of 7.04. 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. As the market closed yesterday, the Internet - Software industry was having an average PEG ratio of 1.06.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 81, putting it in the top 33% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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This article originally published on Zacks Investment Research (zacks.com).
