In the latest close session, Datadog (DDOG) was up +1.96% at $123.43. The stock's performance was ahead of the S&P 500's daily gain of 0.26%. On the other hand, the Dow registered a gain of 0.24%, and the technology-centric Nasdaq increased by 0.36%.
The data analytics and cloud monitoring company's stock has dropped by 7.77% in the past month, falling short of the Computer and Technology sector's gain of 9.34% and the S&P 500's gain of 5.98%.
Investors will be eagerly watching for the performance of Datadog in its upcoming earnings disclosure. The company is expected to report EPS of $0.5, up 8.7% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $956.97 million, up 25.66% from the year-ago period.
For the full year, the Zacks Consensus Estimates project earnings of $2.12 per share and a revenue of $4.08 billion, demonstrating changes of +3.41% and +19.17%, respectively, from the preceding 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. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Datadog presently features a Zacks Rank of #3 (Hold).
Looking at its valuation, Datadog is holding a Forward P/E ratio of 57.02. This expresses a premium compared to the average Forward P/E of 18.83 of its industry.
It's also important to note that DDOG currently trades at a PEG ratio of 4.94. 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 was holding an average PEG ratio of 1.09 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 89, this industry ranks in the top 37% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow DDOG in the coming trading sessions, be sure to utilize Zacks.com.
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Datadog, Inc. (DDOG): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).