Datadog Stock Upgraded by Mizuho, Poised for Upside Amid Vendor Consolidation Trend

Datadog stock poised for upside with vendor consolidation - Mizuho By Investing.com

On Tuesday, Mizuho Securities expressed a positive outlook on Datadog (NASDAQ:DDOG) stock, a prominent player in the observability market, by raising its price target on the company's shares to $155 from $135. The firm maintained its Outperform rating on the stock. The decision to increase the price target follows a series of favorable observations by Mizuho. The firm noted that Datadog is reinforcing its position as a leading entity in the observability space, with multiple product areas achieving scale and newer products expanding rapidly. Mizuho's recent checks surpassed expectations, revealing significant transactions and a trend towards vendor consolidation. Mizuho anticipates that Datadog could potentially surpass the current Wall Street revenue estimates for the second quarter. The firm also regards the management's revenue guidance for 2024 as conservative, suggesting there is room for positive adjustments. The analyst from Mizuho highlighted Datadog's evolving strategy, pointing out that the company is adopting a more channel-friendly approach, which could further enhance its market position and growth. Despite Datadog's slight underperformance compared to the IGV index year-to-date, Mizuho believes that the current share price offers an attractive opportunity for investors. The upgraded price target to $155 from the previous $135 reflects the firm's confidence in Datadog's potential for revenue growth and market leadership. In other recent news, Datadog has been the subject of various analyst ratings and has introduced new product features. Evercore ISI initiated coverage on Datadog, setting an Outperform rating and a price target of $150.00 per share. The firm anticipates that Datadog will become a more consistent performer in terms of revenue and share price, with the potential to exceed financial estimates, broaden its market, and add value with its new artificial intelligence offerings. Loop Capital maintained a Buy rating on Datadog, expecting modest revenue growth based on positive industry trends for new cloud deployments. Truist Securities also sustained its Buy rating for Datadog, praising the company's product advancements displayed at the Datadog DASH event. However, Monness, Crespi, Hardt downgraded Datadog from Neutral to Sell due to valuation concerns, while Goldman Sachs (NYSE:GS) reaffirmed its Buy rating, citing strong growth potential driven by artificial intelligence. Datadog has also integrated its Agent with the OpenTelemetry Collector, enhancing its observability solutions. The company unveiled Log Workspaces, a feature designed to facilitate complex queries and enrich log data analysis. Additionally, Datadog has expanded its security features for cloud applications, including Agentless Scanning, Data Security, and Code Security. These recent developments reflect Datadog's commitment to innovation, growth, and security in its product offerings. Following Mizuho Securities' upbeat assessment of Datadog (NASDAQ:DDOG), real-time data from InvestingPro aligns with the firm's positive outlook. With a market capitalization of $43.29 billion, Datadog stands as a robust player in the observability market. Impressively, the company has maintained a high gross profit margin of 81.42% over the last twelve months as of Q1 2024, indicating efficient operations and strong pricing power. Additionally, Datadog's revenue growth remains vigorous, with a 25.87% increase in the last twelve months as of Q1 2024. InvestingPro Tips highlight that Datadog holds more cash than debt on its balance sheet and is expected to see net income growth this year, which could be pivotal for investors seeking companies with solid financial health and growth prospects. Moreover, with analysts predicting the company will be profitable this year and Datadog having been profitable over the last twelve months, there's a clear trajectory of financial performance that could be appealing to potential investors. For those interested in further insights, InvestingPro offers an additional 11 tips for Datadog, which can be accessed by visiting https://www.investing.com/pro/DDOG. To delve deeper into these expert analyses, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, enhancing your investment research with comprehensive data and expert tips.

Datadog rises on back of Mizuho upgrade (DDOG)

Datadog (NASDAQ:DDOG) was in focus on Tuesday as Mizuho Securities upgraded the software company, citing added opportunity to boost revenue this year. Shares rose 2.7% in premarket trading. Based on some larger transactions and further evidence of vendor consolidation, Datadog looks to be in a position where it can show "meaningful" revenue upside compared to Wall Street estimates, Mizuho analyst Gregg Moskowitz wrote in an investor note. Moskowitz raised his rating on Datadog to Outperform from Neutral and upped his price target to $155 from $135. Additionally, Moskowitz said that he believes that the revenue guidance that Datadog's management provided for 2024 is "quite conservative." For the full-year, Datadog expects sales to be between $2.59B and $2.61B. Lastly, with Datadog up only 12.5% year-to-date, now is an "attractive entry point" for investors, Moskowitz added. Analysts are largely bullish on Datadog (DDOG). It has a HOLD rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates DDOG a HOLD. More on Datadog Datadog: Patience Is Required Datadog: Growth Triad Still Holds Strong, AI Expansion, TAM, And Profitability Datadog: Approaching A Buy Point, Wait Until Low $90s To Dive In Datadog continues gains for seven straight sessions Datadog ticks up following DASH conference revelations