Datadog (NASDAQ:DDOG) Shares Gap Down After Analyst Downgrade

Key Points

• BMO Capital Markets cut its price target on Datadog from $215 to $170, sending shares to gap down (opened $134.37 vs prior close $140.56) and trade lower around $129 with heavy volume, down roughly 7.9%.
• Significant insider selling: corporate insiders sold 1,071,709 shares worth about $192.6 million over the last 90 days (including the CTO and COO), though insiders still own about 8.7% of the company.
• Company fundamentals remain solid: Datadog beat the quarter (EPS $0.55 vs $0.45; revenue $885.65M vs $852.77M, +28.4% YoY) and guided FY25 EPS to $2.00–2.02.

Datadog, Inc. (NASDAQ:DDOG - Get Free Report)'s share price gapped down before the market opened on Thursday after BMO Capital Markets lowered their price target on the stock from $215.00 to $170.00. The stock had previously closed at $140.56, but opened at $134.37. BMO Capital Markets currently has an outperform rating on the stock. Datadog shares last traded at $129.0150, with a volume of 2,650,781 shares trading hands.

DDOG has been the subject of several other research reports. Barclays dropped their price target on Datadog from $215.00 to $195.00 and set an "overweight" rating for the company in a research report on Monday, January 12th. Cantor Fitzgerald increased their price target on Datadog from $179.00 to $220.00 and gave the company an "overweight" rating in a report on Friday, November 7th. Scotiabank decreased their price target on Datadog from $217.00 to $180.00 and set a "sector outperform" rating on the stock in a report on Tuesday. Citigroup dropped their price objective on shares of Datadog from $200.00 to $175.00 and set a "buy" rating for the company in a research note on Friday, January 16th. Finally, Bank of America raised their target price on shares of Datadog from $180.00 to $215.00 and gave the stock a "buy" rating in a report on Friday, November 7th. Thirty-five research analysts have rated the stock with a Buy rating, four have issued a Hold rating and two have issued a Sell rating to the company. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and an average target price of $190.77.

Insider Buying and Selling

In other news, CTO Alexis Le-Quoc sold 43,106 shares of the stock in a transaction on Monday, January 5th. The stock was sold at an average price of $133.93, for a total transaction of $5,773,186.58. Following the transaction, the chief technology officer owned 301,458 shares of the company's stock, valued at approximately $40,374,269.94. This represents a 12.51% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, COO Adam Blitzer sold 8,023 shares of the company's stock in a transaction dated Wednesday, December 3rd. The stock was sold at an average price of $154.61, for a total transaction of $1,240,436.03. Following the completion of the sale, the chief operating officer directly owned 165,197 shares of the company's stock, valued at approximately $25,541,108.17. This trade represents a 4.63% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 1,071,709 shares of company stock worth $192,590,597 over the last 90 days. Corporate insiders own 8.70% of the company's stock.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently made changes to their positions in the stock. Callan Family Office LLC boosted its stake in shares of Datadog by 145.6% during the 2nd quarter. Callan Family Office LLC now owns 22,680 shares of the company's stock worth $3,047,000 after acquiring an additional 13,445 shares in the last quarter. PKO Investment Management Joint Stock Co purchased a new position in shares of Datadog during the 3rd quarter worth approximately $1,709,000. Munro Partners purchased a new stake in Datadog in the 3rd quarter valued at approximately $7,120,000. Sumitomo Mitsui DS Asset Management Company Ltd increased its position in Datadog by 37.9% during the third quarter. Sumitomo Mitsui DS Asset Management Company Ltd now owns 109,233 shares of the company's stock worth $15,555,000 after buying an additional 30,008 shares in the last quarter. Finally, Yousif Capital Management LLC lifted its position in shares of Datadog by 869.3% in the third quarter. Yousif Capital Management LLC now owns 36,777 shares of the company's stock valued at $5,237,000 after acquiring an additional 32,983 shares in the last quarter. 78.29% of the stock is currently owned by hedge funds and other institutional investors.

Datadog Trading Down 7.9%

The firm has a market cap of $45.40 billion, a price-to-earnings ratio of 417.12, a price-to-earnings-growth ratio of 24.66 and a beta of 1.26. The business has a 50 day moving average of $140.71 and a 200 day moving average of $145.52. The company has a quick ratio of 3.66, a current ratio of 3.66 and a debt-to-equity ratio of 0.29.

Datadog (NASDAQ:DDOG - Get Free Report) last released its quarterly earnings results on Thursday, November 6th. The company reported $0.55 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.45 by $0.10. Datadog had a net margin of 3.32% and a return on equity of 4.14%. The company had revenue of $885.65 million for the quarter, compared to analysts' expectations of $852.77 million. During the same period last year, the company earned $0.46 EPS. The firm's revenue for the quarter was up 28.4% compared to the same quarter last year. Datadog has set its FY 2025 guidance at 2.000-2.020 EPS and its Q4 2025 guidance at 0.54-0.56 EPS. On average, research analysts forecast that Datadog, Inc. will post 0.34 earnings per share for the current fiscal year.

About Datadog

Datadog NASDAQ: DDOG is a cloud-based monitoring and observability platform that helps organizations monitor, troubleshoot and secure their applications and infrastructure at scale. Its software-as-a-service offering collects and analyzes metrics, traces and logs from servers, containers, cloud services and applications to provide real-time visibility into system performance and health. Datadog's platform is widely used by engineering, operations and security teams to reduce downtime, accelerate incident response and improve application reliability.

The company's product suite includes infrastructure monitoring, application performance monitoring (APM), log management, real user monitoring (RUM), synthetic monitoring and network performance monitoring, along with security-focused products such as security monitoring and cloud SIEM.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.