Datadog (DDOG)
NASDAQ:DDOG
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Datadog
(NASDAQ:DDOG)
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Rating:65Neutral
Price Target:
$119.00
▼(-6.01% Downside)
Action:ReiteratedDate:02/10/26
The score is supported primarily by strong financial quality (high gross margins and robust free cash flow) and a positive earnings call emphasizing demand strength and backlog/bookings momentum. It is weighed down by weak technicals (clear downtrend with negative momentum) and a very expensive valuation (P/E 386), alongside guidance pointing to slower growth and ongoing investment-driven margin pressure.
Positive Factors
Strong cash generation & free cash flow
Sustained operating cash flow (~$1.05B TTM) and near-$1.0B free cash flow provide durable financial flexibility to fund R&D, multi-year product investments, and potential strategic initiatives without relying on equity funding. Strong FCF also supports deleveraging and resilience if top-line growth moderates.
Negative Factors
Guidance implies growth deceleration
Management's full-year guidance signals a meaningful step-down in growth versus recent quarter performance. A durable slowdown would strain operating leverage expectations and requires maintaining product-led expansion or margin discipline to preserve long-term earnings trajectory amid heavier investment.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation & free cash flow
Sustained operating cash flow (~$1.05B TTM) and near-$1.0B free cash flow provide durable financial flexibility to fund R&D, multi-year product investments, and potential strategic initiatives without relying on equity funding. Strong FCF also supports deleveraging and resilience if top-line growth moderates.
Read all positive factors
Datadog (DDOG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$47.27B
Dividend YieldN/A
Average Volume (3M)4.37M
Price to Earnings (P/E)438.4
Beta (1Y)1.25
Revenue Growth27.68%
EPS Growth-43.37%
CountryUS
Employees8,100
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.59
Shares Outstanding328,483,370
10 Day Avg. Volume4,969,067
30 Day Avg. Volume4,366,350
Financial Highlights & Ratios
PEG Ratio-10.05
Price to Book (P/B)12.65
Price to Sales (P/S)13.78
P/FCF Ratio47.20
Enterprise Value/Market Cap1.03
Enterprise Value/Revenue14.16
Enterprise Value/Gross Profit17.72
Enterprise Value/Ebitda213.83
Forecast
1Y Price Target
$178.65Price Target Upside41.11% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering37
EPS Forecast (FY)2.15
Revenue Forecast (FY)$4.12B
Datadog Business Overview & Revenue Model
Company Description
Datadog, Inc. provides monitoring and analytics platform for developers, information technology operations teams, and business users in the cloud in North America and internationally. The company's SaaS platform integrates and automates infrastruc...
How the Company Makes Money
Datadog primarily makes money by selling subscriptions to its cloud-based observability and security platform. Revenue is largely generated through usage-based and product-based pricing where customers pay based on the volume of telemetry they ing...
Datadog Key Performance Indicators (KPIs)
Any
Customers Over $100k
Shows the number of customers generating over $100,000 in annual revenue, reflecting the company's ability to attract and retain high-value clients.
Shows the number of customers generating over $100,000 in annual revenue, reflecting the company's ability to attract and retain high-value clients.
Data provided by:
The Fly
The FlyDatadog Earnings Call Summary
Earnings Call Date:Feb 10, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call presented many strong operational and financial highlights: accelerated revenue growth (+29% YoY), record bookings (+37% YoY), rising platform adoption and large multi‑product deals, healthy cash generation (FCF $291M, 31% margin), strong retention (~120% net retention), and notable AI product momentum (multiple product launches and rapid usage growth). Offsetting these positives are conservative FY2026 guidance implying year-over-year deceleration (18%–20%), sustained high OpEx growth as the company invests in AI and go-to-market (affecting near-term margins), slight gross margin compression, and some transparency gaps around AI cohort revenue and dependence on the largest customer. On balance, the highlights materially outweigh the lowlights given robust demand, strong bookings/RPO tailwinds, expanding ARR pillars, and healthy cash flows, while the lowlights are primarily related to measured conservatism and continued investment.Positive Updates
Strong Q4 Revenue Growth
Revenue was $953 million, up 29% year-over-year and up 8% sequentially, beating the high end of guidance.
Negative Updates
Guidance Reflects Slower Full-Year Growth
Full-year FY2026 revenue guidance of $4.06–$4.10 billion implies 18%–20% year-over-year growth, a deceleration from recent quarter growth (Q4 +29%), reflecting a more conservative outlook for the year.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Q4 Revenue Growth
Revenue was $953 million, up 29% year-over-year and up 8% sequentially, beating the high end of guidance.
Read all positive updates
Company Guidance
Datadog guided Q1 revenue of $951–$961M (up 25–26% YoY), non‑GAAP operating income of $195–$205M (implying ~21% operating margin) and non‑GAAP EPS of $0.49–$0.51 based on ~367M diluted shares; for FY2026 it expects revenue of $4.06–$4.10B (18–20% YoY), non‑GAAP operating income of $840–$880M (≈21% margin) and non‑GAAP EPS of $2.08–$2.16 based on ~372M diluted shares, with modeling that the business excluding the largest customer grows at least 20% during the year. Additional guidance items include net interest and other income of about $140M, cash taxes of ~$30–$40M, a 21% non‑GAAP tax rate going forward, and capital expenditures plus capitalized software of roughly 4–5% of revenue.Datadog Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
70
Positive
Cash Flow
86
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.43B | 2.68B | 2.13B | 1.68B | 1.03B |
| Gross Profit | 2.74B | 2.17B | 1.72B | 1.33B | 793.94M |
| EBITDA | 260.61M | 317.99M | 150.21M | 41.10M | 25.57M |
| Net Income | 107.74M | 183.75M | 48.57M | -50.16M | -20.75M |
Balance Sheet | |||||
| Total Assets | 6.64B | 5.79B | 3.94B | 3.00B | 2.38B |
| Cash, Cash Equivalents and Short-Term Investments | 4.47B | 4.19B | 2.58B | 1.88B | 1.55B |
| Total Debt | 1.54B | 1.84B | 902.34M | 837.52M | 807.75M |
| Total Liabilities | 2.91B | 3.07B | 1.91B | 1.59B | 1.34B |
| Stockholders Equity | 3.73B | 2.71B | 2.03B | 1.41B | 1.04B |
Cash Flow | |||||
| Free Cash Flow | 1.00B | 835.88M | 632.37M | 353.52M | 250.52M |
| Operating Cash Flow | 1.05B | 870.60M | 659.95M | 418.41M | 286.55M |
| Investing Cash Flow | -1.33B | -736.84M | -731.37M | -384.67M | -273.74M |
| Financing Cash Flow | -572.48M | 787.08M | 58.28M | 36.02M | 34.94M |
Datadog Technical Analysis
Neutral
126.61
Price Trends
119.43
Positive
129.17
Negative
138.60
Negative
Market Momentum
-0.86
Negative
58.33
Neutral
87.81
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DDOG, the sentiment is Neutral. The current price of 126.61 is above the 20-day moving average (MA) of 118.38, above the 50-day MA of 119.43, and below the 200-day MA of 138.60, indicating a neutral trend. The MACD of -0.86 indicates Negative momentum. The RSI at 58.33 is Neutral, neither overbought nor oversold. The STOCH value of 87.81 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DDOG.
Datadog Risk Analysis
Datadog disclosed 59 risk factors in its most recent earnings report. Datadog reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Datadog Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $114.73B | 720.36 | -4.68% | ― | 21.71% | -908.90% | |
72 Outperform | $10.86B | 81.46 | 6.81% | ― | 18.20% | -62.03% | |
65 Neutral | $47.27B | 438.37 | 3.24% | ― | 27.68% | -43.37% | |
64 Neutral | $565.11M | 5.56 | 77.23% | ― | 5.36% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $48.82B | -48.84 | -60.27% | ― | 29.16% | -2.26% |
* Technology Sector Average
DDOG
Datadog
133.98
27.66
26.02%
PD
PagerDuty
6.65
-8.90
-57.23%
CRWD
CrowdStrike Holdings
452.38
20.50
4.75%
DT
Dynatrace
36.40
-11.04
-23.27%
SNOW
Snowflake
141.22
-24.14
-14.60%
Datadog Corporate Events
Executive/Board Changes
Datadog Expands Board and Appoints New Class II Director
Neutral
Mar 2, 2026
On February 26, 2026, Datadog, Inc. expanded its Board of Directors from ten to eleven members and appointed Dominic Phillips as a Class II director, with his term set to run until the 2027 Annual Meeting of Stockholders. The company noted that Ph...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.