Datadog (DDOG) closed the most recent trading day at $264.46, moving -2.32% from the previous trading session. This change lagged the S&P 500's daily gain of 0.38%. On the other hand, the Dow registered a gain of 0.29%, and the technology-centric Nasdaq increased by 0.62%.
Prior to today's trading, shares of the data analytics and cloud monitoring company had gained 17.14% outpaced the Computer and Technology sector's loss of 0.53% and the S&P 500's gain of 1.61%.
Market participants will be closely following the financial results of Datadog in its upcoming release. In that report, analysts expect Datadog to post earnings of $0.58 per share. This would mark year-over-year growth of 26.09%. In the meantime, our current consensus estimate forecasts the revenue to be $1.08 billion, indicating a 30.22% growth compared to the corresponding quarter of the prior year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $2.41 per share and a revenue of $4.34 billion, signifying shifts of +17.56% and +26.62%, respectively, from the last year.
It is also important to note the recent changes to analyst estimates for Datadog. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
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. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 5.3% increase. At present, Datadog boasts a Zacks Rank of #3 (Hold).
Digging into valuation, Datadog currently has a Forward P/E ratio of 112.17. This valuation marks a premium compared to its industry average Forward P/E of 19.89.
One should further note that DDOG currently holds a PEG ratio of 7.32. 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 currently had an average PEG ratio of 1.06 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 92, finds itself in the top 38% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Datadog, Inc. (DDOG): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).