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Datadog (DDOG) Stock Analysis

This is a peer-relative look at Datadog (DDOG): its performance, risk, profitability, growth, financial strength, dividend, and valuation are each measured against its Software & Services peers, so every number reads in context rather than in isolation.

Company Profile

Company profile fields for Datadog (DDOG)
Profile ItemDDOG
NameDatadog Inc. Class A
Country/RegionUnited States
GICS SectorInformation Technology
GICS Industry GroupSoftware & Services
GICS IndustrySoftware
GICS Sub-IndustryApplication Software
Market Capitalization64.64 billion USD
CurrencyUSD
ExchangeNasdaq
Listing DateSeptember 19, 2019
Security TypeCommon Stock

Price Performance

Cumulative Growth

DDOG
GSPC
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Datadog (DDOG) vs. S&P 500 (GSPC): Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

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Trailing total returns for Datadog (DDOG) and S&P 500 (GSPC). Returns over one year are annualized.

Calendar-Year Returns

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Calendar-year total returns for Datadog (DDOG) and S&P 500 (GSPC). Each bar is that year's total return, measured year-end to year-end.

Performance Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Total Return (1Y)-5.64%-3.00%
Total Return (3Y, Annualized)21.65%8.28%
Total Return (5Y, Annualized)-1.69%-7.91%

Risk Profile

Drawdown History

DDOG
GSPC
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Datadog (DDOG) vs. S&P 500 (GSPC): Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Return Distribution

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Distribution of monthly total returns for Datadog (DDOG) and S&P 500 (GSPC). Each bar is the share of months whose return fell in that 5% bucket.

Risk Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Volatility (1Y, Annualized)70.49%61.69%
Beta (5Y)1.571.06
Max Drawdown (5Y)-68.11%-76.52%

Risk-Adjusted Performance

Risk-Return Positioning

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Each dot is a stock plotted by 1-year volatility (risk) and 1-year return. DDOG is highlighted; the dashed line is the Capital Allocation Line from the risk-free rate through the industry median — dots above it are stronger on a risk-adjusted basis.

Risk-Adjusted Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Sharpe Ratio (1Y)-0.14-0.13
Sortino Ratio (1Y)-0.21-0.19

Profitability

ROE (TTM)

Datadog (DDOG) posts ROE of 6.43%, roughly around the peer group’s normal range. Shareholders’ equity is producing a return that looks broadly typical for the industry.

DDOG

Software & Services industry group

6.43%

Group distribution
Max
53.85%
Q3
17.90%
Median
6.59%
DDOG
6.43%
Q1
-9.59%
Min
-50.52%
Largest peers
ORCL
41.19%
PLTR
40.91%
IBM
34.77%
MSFT
34.22%
SAP
18.18%
DDOG
6.43%
PANW
1.74%
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Where Datadog (DDOG) stands on ROE within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Net Margin (TTM)

Datadog (DDOG) keeps 6.12% of revenue as net profit, roughly in line with the peer group’s normal net margin range. Its full cost stack is taking a typical share of sales for the industry.

DDOG

Software & Services industry group

6.12%

Group distribution
Max
41.17%
Q3
15.28%
DDOG
6.12%
Median
4.63%
Q1
-5.42%
Min
-33.17%
Largest peers
PLTR
50.34%
MSFT
41.17%
ORCL
26.36%
SAP
20.41%
IBM
15.99%
DDOG
6.12%
PANW
2.67%
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Where Datadog (DDOG) stands on net margin within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Operating Margin (TTM)

Datadog (DDOG) turns 6.33% of revenue into operating profit, roughly in line with the peer group’s normal operating margin range. Its core cost structure looks typical for the industry.

DDOG

Software & Services industry group

6.33%

Group distribution
Max
46.89%
Q3
17.64%
Median
8.73%
DDOG
6.33%
Q1
-2.13%
Min
-30.45%
Largest peers
MSFT
49.76%
PLTR
46.89%
ORCL
35.63%
SAP
29.50%
IBM
16.97%
DDOG
6.33%
PANW
5.40%
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Where Datadog (DDOG) stands on operating margin within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Profitability Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
ROE (TTM)6.43%6.59%
ROA (TTM)0.91%2.45%
Net Margin (TTM)6.12%4.63%
Operating Margin (TTM)6.33%8.73%
Gross Margin (TTM)79.61%70.07%

Growth

Revenue Growth

Datadog (DDOG) grew revenue 27.68%, in the upper peer quartile. The top line is expanding faster than at most industry peers, which points to share gains or stronger pricing.

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Datadog (DDOG): Revenue Growth across different time periods, set against Software & Services industry-group medians.

EPS Growth

Datadog (DDOG) grew earnings per share -40.38%, in the lower peer quartile. Per-share profits are advancing more slowly than at most peers, so margins, costs, or share count deserve a closer look.

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Datadog (DDOG): EPS Growth across different time periods, set against Software & Services industry-group medians.

Growth Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Revenue Growth (YoY)27.68%14.22%
Revenue Growth (3Y CAGR)26.95%13.52%
EPS Growth (YoY)-40.38%7.85%
EPS Growth (3Y CAGR)--18.19%

Financial Strength

Current Ratio (MRQ)

Datadog (DDOG) has current ratio of 3.51, above the industry’s typical middle range. Liquidity looks ample versus peers, though an unusually high cushion can also mean idle current assets or inefficient working capital.

DDOG

Software & Services industry group

3.51

Group distribution
Max
5.11
DDOG
3.51
Q3
2.77
Median
1.67
Q1
1.01
Min
0.03
Largest peers
PLTR
7.10
DDOG
3.51
MSFT
1.23
ORCL
1.17
SAP
1.16
PANW
0.87
IBM
0.86
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Where Datadog (DDOG) stands on current ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Debt / Equity (MRQ)

Datadog (DDOG) has debt-to-equity ratio of 0.28, roughly in line with the peer group’s normal leverage range. Its mix of debt and equity looks typical for the industry.

DDOG

Software & Services industry group

0.28

Group distribution
Max
2.52
Q3
1.13
Median
0.40
DDOG
0.28
Q1
0.07
Min
0.00
Largest peers
ORCL
2.52
IBM
1.85
MSFT
0.28
DDOG
0.28
SAP
0.23
PANW
0.09
PLTR
0.02
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Where Datadog (DDOG) stands on debt-to-equity ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Financial Strength Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Current Ratio (MRQ)3.511.67
Debt / Equity (MRQ)0.280.40
Net Debt / EBITDA-23.060.17

Dividends

Dividend Yield (TTM)

Datadog (DDOG) pays no dividend, leaving dividend yield at 0.00% this period. Shareholders may still receive value through reinvestment or buybacks, but there is no dividend income to compare here.

DDOG

Software & Services industry group

0.00%

Group distribution
DDOG
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
Largest peers
IBM
2.73%
ORCL
1.74%
SAP
1.03%
MSFT
0.69%
DDOG
0.00%
PLTR
0.00%
PANW
0.00%
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Where Datadog (DDOG) stands on dividend yield within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Dividend Payout Ratio (TTM)

Datadog (DDOG) paid no earnings out as dividends this period, leaving payout ratio at 0.00%. There is no dividend payout to size against earnings.

DDOG

Software & Services industry group

0.00%

Group distribution
DDOG
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
Largest peers
IBM
57.51%
SAP
36.45%
ORCL
31.35%
MSFT
19.00%
DDOG
0.00%
PLTR
0.00%
PANW
0.00%
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Where Datadog (DDOG) stands on payout ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Dividend Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
Dividend Yield (TTM)0.00%0.00%
Dividend Payout Ratio (TTM)0.00%0.00%

Valuation

P/E Ratio (TTM)

Datadog (DDOG) trades at P/E ratio of 248.67, above the peer range for its industry. The market is paying unusually heavily for TTM earnings relative to comparable companies.

DDOG

Software & Services industry group

248.67

Group distribution
DDOG
248.67
Max
112.94
Q3
60.32
Median
32.91
Q1
18.77
Min
6.69
Largest peers
PANW
784.60
DDOG
248.67
PLTR
112.94
SAP
29.07
MSFT
27.69
IBM
20.90
ORCL
18.20
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Where Datadog (DDOG) stands on P/E ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

P/S Ratio (TTM)

Datadog (DDOG) trades at 15.11 on P/S ratio, in the higher sales-valuation quartile. Investors are paying up for each dollar of revenue, so stronger margins, growth, or revenue quality need to carry that price.

DDOG

Software & Services industry group

15.11

Group distribution
Max
17.91
DDOG
15.11
Q3
8.78
Median
4.25
Q1
2.23
Min
0.02
Largest peers
PLTR
53.02
PANW
22.37
DDOG
15.11
MSFT
11.37
SAP
6.84
ORCL
5.04
IBM
3.31
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Where Datadog (DDOG) stands on P/S ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

P/B Ratio (MRQ)

Datadog (DDOG) trades at 13.71 on P/B ratio, in the higher book-value quartile. The market is paying a premium to book, so stronger ROE, cleaner assets, or a better growth profile need to justify it.

DDOG

Software & Services industry group

13.71

Group distribution
Max
16.63
DDOG
13.71
Q3
8.50
Median
4.30
Q1
1.92
Min
-3.90
Largest peers
SAP
73.25
PLTR
34.41
DDOG
13.71
PANW
9.30
MSFT
8.38
IBM
6.52
ORCL
5.68
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Where Datadog (DDOG) stands on P/B ratio within its Software & Services peer group — the box is the group’s distribution and the dots its largest members.

Valuation Metrics

Datadog (DDOG) metric values compared with Software & Services industry-group medians
MetricCurrent stock: DDOGIndustry group median
P/E Ratio (TTM)248.6732.91
P/S Ratio (TTM)15.114.25
P/B Ratio (MRQ)13.714.30
Free Cash Flow Yield (TTM)1.65%3.98%