Bernstein sets new outperform rating on cloud software provider Datadog
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Bernstein analyst Peter Weed on Tuesday initiated coverage of cloud-based business software company Datadog (NASDAQ:DDOG) with an outperform rating due to several factors such as an expanding total addressable market for its products.
Weed said that after Datadog (DDOG) saw a delay in application deployment projects during the COVID pandemic, the company's customers have stepped up their efforts to move operations to the cloud.
Datadog (DDOG) has forecast its 2022 fiscal year revenue to grow by 56% over last year, but Weed said he believes the company is being "quite cautious" with its outlook. Weed said that it is "credible" that Datadog can turn in year-over-year revenue growth of more than 70% this year. Weed said that based on the opportunities for its cloud service, the company "appears under-appreciated for how well it will do."
Weed also set a price target of $172 a share on Datadog's (DDOG) shares.
Wall Street analysts and Seeking Alpha authors both have a consensus buy rating on Datadog's (DDOG) shares. Meanwhile, Seeking Alpha's quant system, which regularly outperforms the market, currently sets Datadog's (DDOG) shares with a hold rating.