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718800.0
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2021-11-15 00:00:00 UTC
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World Wrestling Entertainment Earnings Report Raises Some Questions
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DDOG
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https://www.nasdaq.com/articles/world-wrestling-entertainment-earnings-report-raises-some-questions-2021-11-15
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nan
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nan
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World Wrestling Entertainment (NYSE: WWE) is having a good year, but some important questions came up in its recent earnings report.
In this video clip from "Beat & Raise," recorded on Nov. 5, Fool.com contributors Brian Withers and Toby Bordelon discuss the highlights from the wrestling specialist's announcement.
10 stocks we like better than World Wrestling Entertainment
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They just revealed what they believe are the ten best stocks for investors to buy right now... and World Wrestling Entertainment wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of November 10, 2021
Brian Withers: I'm going to turn it over to Toby, who's going to cover World Wrestling Entertainment, which only has the second best logo today after Datadog. [laughs]
Toby Bordelon: Yeah, it's free logo, isn't it? Now, I don't know if you follow wrestling, Brian, if you're a fan of wrestling entertainment.
Withers: I don't.
Bordelon: You don't. I'm not a huge fan, but I do remember back in the day, I remember following this company before it had this little trademark dispute with the World Wildlife Federation, it was known as a WWF way back in the day. The days of Undertaker and Kane, even Hulk Hogan. I mean, they come a long way since then. Good quarter for them. I think revenue up 15 percent. Borderline. I mean, meet, miss, depends on your perspective. They beat earnings per share.
They did raise their outlook a little bit. They said they expect [inaudible 03:17:39] percent higher OIBDA. I don't know how to pronounce that. If you're looking at that and say what is that, good question. It's maybe the first time I've ever actually seen that particular acronym, operating income before depreciation and amortization. It's one of those non-GAAP measures. If they want to give it to us, fine, we'll judge them on that. I do like operating income, so maybe it's a legit metric there to look at.
But that revenue increase was really they said driven by higher ticket sales, the primary driver within their merchandise. Because what's happened is they are back on tour. Live touring is back. They return to events toward in July. They're seeing ticket demand outpace their expectations. North American events, they said, attracted the highest quarterly attendance in over a decade. The people want their WWE, Brian.
That's what the people want. Apparently, that's what they're delivering. SummerSlam in Vegas was a record-breaking crowd, with sponsorship and merchandise sales 155% higher than SummerSlam 2019.
So pre-pandemic. Pretty good. It looks like they're coming back pretty well. Digital video views are also up 39%. Hours consumed are at a record, 411 million, up 20%. That's interesting because you would think in this quarter, coming out of the pandemic, at home video streaming might be a little bit down. But for them, they are doing pretty well on that. I like with what I see.
They did announce a new CFO. That was a little random and unexpected. I don't quite know what to make of that. They haven't given any reason for the departure yet, so I'm not really sure what's going on there.
The CFO, Kristina Salen, she left after 15 months, so she wasn't there very long. The gentlemen replacing her, Mr. Frank Riddick III is a board member, so he's been with the company since 2008. So he knows what's going on. It's not just some random new hire.
But a little bit of a concern there. They did also do a lot of share repurchasing and you wonder why. You would think for a company like this coming out of a pandemic, there's room for investments, at least initially. But here we go, we're getting a lot of share repurchases.
But not a bad quarter, stocks down a little bit. But I like what I see and I like that they seem to be doing very well relative to their pre-pandemic metrics and hope we get everything back up and running again pretty soon.
Withers: Yeah, it's really interesting. You say they're seeing record crowds and they may be on track to beat their OIBDA next quarter. We'll have you back to report on their made-up metric.
Demitri Kalogeropoulos has no position in any of the stocks mentioned. Toby Bordelon has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Datadog. The Motley Fool recommends World Wrestling Entertainment. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
World Wrestling Entertainment (NYSE: WWE) is having a good year, but some important questions came up in its recent earnings report. In this video clip from "Beat & Raise," recorded on Nov. 5, Fool.com contributors Brian Withers and Toby Bordelon discuss the highlights from the wrestling specialist's announcement. * They just revealed what they believe are the ten best stocks for investors to buy right now... and World Wrestling Entertainment wasn't one of them!
|
In this video clip from "Beat & Raise," recorded on Nov. 5, Fool.com contributors Brian Withers and Toby Bordelon discuss the highlights from the wrestling specialist's announcement. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. The Motley Fool recommends World Wrestling Entertainment.
|
* They just revealed what they believe are the ten best stocks for investors to buy right now... and World Wrestling Entertainment wasn't one of them! See the 10 stocks *Stock Advisor returns as of November 10, 2021 Brian Withers: I'm going to turn it over to Toby, who's going to cover World Wrestling Entertainment, which only has the second best logo today after Datadog. I'm not a huge fan, but I do remember back in the day, I remember following this company before it had this little trademark dispute with the World Wildlife Federation, it was known as a WWF way back in the day.
|
In this video clip from "Beat & Raise," recorded on Nov. 5, Fool.com contributors Brian Withers and Toby Bordelon discuss the highlights from the wrestling specialist's announcement. See the 10 stocks *Stock Advisor returns as of November 10, 2021 Brian Withers: I'm going to turn it over to Toby, who's going to cover World Wrestling Entertainment, which only has the second best logo today after Datadog. But I like what I see and I like that they seem to be doing very well relative to their pre-pandemic metrics and hope we get everything back up and running again pretty soon.
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0e4ae425-f29e-40ce-b231-2dbc5ffdfbdf
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718801.0
|
2021-11-12 00:00:00 UTC
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Datadog Reaches Analyst Target Price
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DDOG
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https://www.nasdaq.com/articles/datadog-reaches-analyst-target-price-2021-11-12
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nan
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nan
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $189.50, changing hands for $190.34/share. When a stock reaches the target an analyst has set, the analyst logically has two ways to react: downgrade on valuation, or, re-adjust their target price to a higher level. Analyst reaction may also depend on the fundamental business developments that may be responsible for driving the stock price higher — if things are looking up for the company, perhaps it is time for that target price to be raised.
There are 14 different analyst targets within the Zacks coverage universe contributing to that average for Datadog Inc, but the average is just that — a mathematical average. There are analysts with lower targets than the average, including one looking for a price of $111.00. And then on the other side of the spectrum one analyst has a target as high as $236.00. The standard deviation is $42.848.
But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $189.50/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $189.50 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? Below is a table showing the current thinking of the analysts that cover Datadog Inc:
RECENT DDOG ANALYST RATINGS BREAKDOWN
» Current 1 Month Ago 2 Month Ago 3 Month Ago
Strong buy ratings: 10 10 11 11
Buy ratings: 1 1 1 1
Hold ratings: 5 5 6 6
Sell ratings: 0 0 0 0
Strong sell ratings: 0 0 0 0
Average rating: 1.69 1.69 1.72 1.72
The average rating presented in the last row of the above table above is from 1 to 5 where 1 is Strong Buy and 5 is Strong Sell. This article used data provided by Zacks Investment Research via Quandl.com. Get the latest Zacks research report on DDOG — FREE.
The Top 25 Broker Analyst Picks of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $189.50, changing hands for $190.34/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $189.50/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $189.50 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $189.50, changing hands for $190.34/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $189.50/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $189.50 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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And so with DDOG crossing above that average target price of $189.50/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $189.50 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $189.50, changing hands for $190.34/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes.
|
In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $189.50, changing hands for $190.34/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $189.50/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $189.50 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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9b55c13a-61fc-4909-ad3a-c13d8599a915
|
718802.0
|
2021-11-09 00:00:00 UTC
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Datadog Firing on All Cylinders
|
DDOG
|
https://www.nasdaq.com/articles/datadog-firing-on-all-cylinders
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nan
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nan
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Datadog’s (DDOG) shares are on the bull run since the monitoring and analytics platform released its Q3 earnings report on November 4.
The rampant digital transformation and cloud migration across industries led to strong demand for the company’s products, leading to a 75% jump in revenues and a 160% surge in non-GAAP earnings per share, year-over-year. The upbeat guidance for the full year of 2021 was another reason for investors to celebrate. (See Insiders’ Hot Stocks on TipRanks)
Expert Opines
Following the print, Needham analyst Jack Andrews analyzed the company’s developments and emerged positive about its prospects. “In our view, Datadog delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital-efficient business model,” argued Andrews.
The analyst was encouraged by the company’s go-to-market strategy of selling infrastructure to customers which gradually progresses to the sale of the platform to the same customers. Moreover, customers believe that learning to monitor infrastructure is necessary early into their cloud-native journey. According to Andrews, Datadog is set to benefit from multiple long-term tailwinds and a large total available market.
Andrews reiterated a Buy rating on Datadog and raised its price target to $236 from $173.
More Potential Upsides
Notably, Datadog’s security products — Cloud Security Posture and Cloud Workload Security — represent an early-stage opportunity, as per management.
Additionally, management also noted that the competitive landscape is favorable, and the company is trying to capture more opportunities to add to its advantage.
Wall Street Weighs In
Turning to Wall Street, the analyst consensus, however, is cautiously optimistic about Datadog, with a Moderate Buy rating based on 10 Buys and four Holds. The average Datadog price target of $206 indicates an upside potential of 6.7%.
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclosure: At the time of publication, Chandrima Sanyal did not have a position in any of the securities mentioned in this article.
Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog’s (DDOG) shares are on the bull run since the monitoring and analytics platform released its Q3 earnings report on November 4. The rampant digital transformation and cloud migration across industries led to strong demand for the company’s products, leading to a 75% jump in revenues and a 160% surge in non-GAAP earnings per share, year-over-year. (See Insiders’ Hot Stocks on TipRanks) Expert Opines Following the print, Needham analyst Jack Andrews analyzed the company’s developments and emerged positive about its prospects.
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Datadog’s (DDOG) shares are on the bull run since the monitoring and analytics platform released its Q3 earnings report on November 4. Andrews reiterated a Buy rating on Datadog and raised its price target to $236 from $173. More Potential Upsides Notably, Datadog’s security products — Cloud Security Posture and Cloud Workload Security — represent an early-stage opportunity, as per management.
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Datadog’s (DDOG) shares are on the bull run since the monitoring and analytics platform released its Q3 earnings report on November 4. More Potential Upsides Notably, Datadog’s security products — Cloud Security Posture and Cloud Workload Security — represent an early-stage opportunity, as per management. Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only.
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Datadog’s (DDOG) shares are on the bull run since the monitoring and analytics platform released its Q3 earnings report on November 4. More Potential Upsides Notably, Datadog’s security products — Cloud Security Posture and Cloud Workload Security — represent an early-stage opportunity, as per management. Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only.
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d223353e-5f1b-4542-a18e-80927683bec0
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718803.0
|
2021-11-09 00:00:00 UTC
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Is It Too Late to Buy Datadog?
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DDOG
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https://www.nasdaq.com/articles/is-it-too-late-to-buy-datadog
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nan
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nan
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Shares of Datadog (NASDAQ: DDOG) -- a data visibility company -- have hit all-time highs 18 times in 2021 alone, with the most recent occurrence on Nov. 5 when the company jumped 12%. This came after the company crushed its third-quarter earnings estimates, beating on both the top and bottom lines.
Shares have jumped 88% this year, reaching a market cap of $58 billion. After this massive run-up, some investors are wondering how much bigger this company can get. The answer? Much bigger. Despite the company being at all-time highs, here's why I think it is still worth adding to your portfolio.
Image source: Getty Images.
Third-quarter highlights
Datadog operates a platform where companies can monitor all of their cloud operations and infrastructure, ensuring everything is secure and performing well. With an increasing amount of data coming from a company's expanding number of applications, it can be hard to monitor performance, security, and user experience all at once, but Datadog provides solutions for this. Datadog's dashboards allow companies to analyze data from their entire system on one dashboard, ensuring that security breaches will be caught, high-quality user experiences can be delivered, and applications will work optimally.
The company's financials back this idea up. Datadog has 1,800 customers spending over $100,000 on its platform, which grew 66% from the year-ago quarter. Its net revenue retention rate was over 130% in Q3 -- marking the 17th consecutive quarter it has been over 130%.77% of Datadog's customers are using two or more platforms, and 31% of customers are using more than three. Churn is in the mid-single digits, so Datadog's major growth opportunity is continuing to expand its relationships with its customers.
These strong customer relationships led to Q3 revenue growth of 75% to $270 million year over year, along with its net loss decreasing from $15 million to just $5.5 million -- or 2% of revenue. The company also generated $57 million in free cash flow in Q3, so its minor net loss is no problem at all. The company has been using its free cash flow diligently toward research and development, which represented $112 million in operating expenses in Q3 -- over 50% of total operating expenses.
The likely beneficiary of this high continued investment in research and development is Datadog's product offering. The company announced 10 new products and features at its annual user conference this quarter, including CI Visibility, which will help companies gain visibility into developer tests, and Session Replay, which will give companies insight into user experiences from a video-like interface.
Datadog provided strong guidance, which was increased from the original second-quarter guidance. Fourth-quarter revenue is expected to reach $291 million -- growing 8% quarter over quarter. The company upgraded its full-year guidance, with revenue guidance of $994 million -- up from Q2 guidance of $941 million.
Lowlights and risks
There wasn't much to complain about in this third quarter. Almost all metrics improved sequentially, and customer growth even accelerated. The only negative thing from this quarter was that the stock became even more expensive. The company traded at an (already high) valuation of 65 times sales on Nov. 3, but it jumped to 75 times sales today. When compared to Dynatrace (NYSE: DT) -- a Datadog competitor trading at 27 times sales -- it is clear just how expensive Datadog is today.
The valuation is the main risk for those looking to invest in Datadog, but when management consistently beats estimates and raises guidance like it did this quarter, a high valuation is not surprising. While there is plenty of competition in Datadog's space, Datadog is the leader, and with low churn and high net retention, it would be hard for a competitor to supplant Datadog in its role.
The road ahead
This quarter showed exemplary growth for Datadog, driven by a combination of factors that are bringing customers deeper into its ecosystem. The company noted that only 31% of its customers use four or more services, so while it has strong relationships with customers, there is still plenty of room to grow these relationships even more. As the company continues to do this, all while using its strong research and development budget to increase its offering, it can increase its retention rate while decreasing its churn rate. This would make it even harder for its competitors to catch up.
To monitor success, investors should watch for increases in customers paying over $100,000, net retention, and the number of customers using four or more services. All of this shows that Datadog is succeeding, meaning that the investment thesis is intact. This company is looking unstoppable, and it has avenues it can explore to continue its winning ways. Because of its strong success and evergreen future, you might want to consider adding Datadog to your portfolio before anything else.
10 stocks we like better than Datadog
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of October 20, 2021
Jamie Louko owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Shares of Datadog (NASDAQ: DDOG) -- a data visibility company -- have hit all-time highs 18 times in 2021 alone, with the most recent occurrence on Nov. 5 when the company jumped 12%. With an increasing amount of data coming from a company's expanding number of applications, it can be hard to monitor performance, security, and user experience all at once, but Datadog provides solutions for this. Churn is in the mid-single digits, so Datadog's major growth opportunity is continuing to expand its relationships with its customers.
|
Shares of Datadog (NASDAQ: DDOG) -- a data visibility company -- have hit all-time highs 18 times in 2021 alone, with the most recent occurrence on Nov. 5 when the company jumped 12%. With an increasing amount of data coming from a company's expanding number of applications, it can be hard to monitor performance, security, and user experience all at once, but Datadog provides solutions for this. These strong customer relationships led to Q3 revenue growth of 75% to $270 million year over year, along with its net loss decreasing from $15 million to just $5.5 million -- or 2% of revenue.
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Shares of Datadog (NASDAQ: DDOG) -- a data visibility company -- have hit all-time highs 18 times in 2021 alone, with the most recent occurrence on Nov. 5 when the company jumped 12%. The company announced 10 new products and features at its annual user conference this quarter, including CI Visibility, which will help companies gain visibility into developer tests, and Session Replay, which will give companies insight into user experiences from a video-like interface. While there is plenty of competition in Datadog's space, Datadog is the leader, and with low churn and high net retention, it would be hard for a competitor to supplant Datadog in its role.
|
Shares of Datadog (NASDAQ: DDOG) -- a data visibility company -- have hit all-time highs 18 times in 2021 alone, with the most recent occurrence on Nov. 5 when the company jumped 12%. Fourth-quarter revenue is expected to reach $291 million -- growing 8% quarter over quarter. The valuation is the main risk for those looking to invest in Datadog, but when management consistently beats estimates and raises guidance like it did this quarter, a high valuation is not surprising.
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7a2224cf-65ae-47c7-85cd-dc52760abb00
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718804.0
|
2021-11-08 00:00:00 UTC
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Datadog, Inc. (NASDAQ:DDOG): When Will It Breakeven?
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DDOG
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https://www.nasdaq.com/articles/datadog-inc.-nasdaq%3Addog%3A-when-will-it-breakeven
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nan
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nan
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We feel now is a pretty good time to analyse Datadog, Inc.'s (NASDAQ:DDOG) business as it appears the company may be on the cusp of a considerable accomplishment. 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 US$58b market-cap company posted a loss in its most recent financial year of US$25m and a latest trailing-twelve-month loss of US$44m leading to an even wider gap between loss and breakeven. Many investors are wondering about the rate at which Datadog will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
According to the 19 industry analysts covering Datadog, the consensus is that breakeven is near. They expect the company to post a final loss in 2022, before turning a profit of US$14m in 2023. So, the company is predicted to breakeven approximately 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 83% year-on-year, on average, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
NasdaqGS:DDOG Earnings Per Share Growth November 8th 2021
Underlying developments driving Datadog's growth isn’t the focus of this broad overview, though, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one issue worth mentioning. Datadog currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Datadog's case is 77%. Note that a higher debt obligation increases the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Datadog which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Datadog, take a look at Datadog's company page on Simply Wall St. We've also put together a list of important aspects you should further examine:
Valuation: What is Datadog worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Datadog is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Datadog’s board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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We feel now is a pretty good time to analyse Datadog, Inc.'s (NASDAQ:DDOG) business as it appears the company may be on the cusp of a considerable accomplishment. NasdaqGS:DDOG Earnings Per Share Growth November 8th 2021 Underlying developments driving Datadog's growth isn’t the focus of this broad overview, though, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period. Datadog, Inc. provides monitoring and analytics platform for developers, information technology operations teams, and business users in the cloud in North America and internationally.
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We feel now is a pretty good time to analyse Datadog, Inc.'s (NASDAQ:DDOG) business as it appears the company may be on the cusp of a considerable accomplishment. NasdaqGS:DDOG Earnings Per Share Growth November 8th 2021 Underlying developments driving Datadog's growth isn’t the focus of this broad overview, though, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period. Many investors are wondering about the rate at which Datadog will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
|
NasdaqGS:DDOG Earnings Per Share Growth November 8th 2021 Underlying developments driving Datadog's growth isn’t the focus of this broad overview, though, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period. We feel now is a pretty good time to analyse Datadog, Inc.'s (NASDAQ:DDOG) business as it appears the company may be on the cusp of a considerable accomplishment. Many investors are wondering about the rate at which Datadog will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
|
We feel now is a pretty good time to analyse Datadog, Inc.'s (NASDAQ:DDOG) business as it appears the company may be on the cusp of a considerable accomplishment. NasdaqGS:DDOG Earnings Per Share Growth November 8th 2021 Underlying developments driving Datadog's growth isn’t the focus of this broad overview, though, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period. Many investors are wondering about the rate at which Datadog will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
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fcc85602-c5ad-4dae-b2c3-d17eae9edc50
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718805.0
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2021-11-08 00:00:00 UTC
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Datadog Reports Stellar Q3 Beat; Shares Up 11%
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DDOG
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https://www.nasdaq.com/articles/datadog-reports-stellar-q3-beat-shares-up-11
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nan
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nan
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Datadog, Inc. (DDOG) shares surged over 11% to close at $185.51 on November 5, approaching its 52-week high, after delivering blowout third-quarter results and raising its FY2021 outlook. The company offers monitoring and Software-as-a-Service (SaaS)-based security data analytics platform for cloud applications.
Impressive Quarterly Figures
The positive quarterly results were driven by robust performance across customer segments and products, aided by strong demand for digital transformation and cloud migration throughout organizations.
Encouragingly, adjusted earnings of $0.13 per share more than doubled year-over-year, massively outpacing analysts’ expectations of $0.06 per share. The company reported earnings of $0.05 per share in the same quarter last year. (See Datadog stock charts on TipRanks)
Similarly, revenues jumped 75% year-over-year to $270 million, exceeding consensus estimates of $247.73 million.
Notably, customers with annual recurring revenue (ARR) of $100,000 or more grew 66% to 1,082 customers, against the same period last year.
Datadog Raises FY2021 Outlook
Adding to investors’ optimism, the company raised the financial guidance for FY2021 based on robust Q3 results, and issued the fourth-quarter outlook, significantly higher than Street expectations.
The company now forecasts FY2021 adjusted earnings in the range of $0.39 to $0.40 per share, against the previous guidance range of $0.26 to $0.28 per share. Revenues are forecasted to be in the range of $993 million to $995 million, against the previously guided range of $938 million to $944 million.
Q4 adjusted earnings are likely to range from $0.11 and $0.12 per share, while the consensus estimate is pegged at $0.06 per share. Revenues are projected to be in the range of $290 million to 292 million, against the consensus estimate of $263.3 million.
Management Weighs In
Sharing his views on new products and features, Datadog CEO, Olivier Pomel, commented, "With ten new products and major features announced at our annual user conference, Dash, we are continuing to innovate at a rapid pace.”
He further added, “We are broadening our observability platform, further developing our Cloud Security Platform, and launching the general availability of CI Visibility, which represents a major step towards shift-left observability for developer workflows.”
Wall Street's Take
Based on the upbeat Q3 results, Morgan Stanley analyst Sanjit Singh increased the price target on Datadog to $200 (7.8% upside potential) from $164, while reiterating a Buy rating.
Singh attributed the price target hike to strong Q3 results, and increased FY2021 revenue growth outlook to 65%.
Meanwhile, the rest of the Wall Street community is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on 9 Buys and 4 Holds. The average Datadog price target of $203.27 implies 9.57% upside potential to current levels.
Related News:
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Qualcomm Posts a Blowout Quarter; Shares Jump 7.5%
Roku’s Q3 Revenues & Q4 Outlook Disappoint
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog, Inc. (DDOG) shares surged over 11% to close at $185.51 on November 5, approaching its 52-week high, after delivering blowout third-quarter results and raising its FY2021 outlook. Management Weighs In Sharing his views on new products and features, Datadog CEO, Olivier Pomel, commented, "With ten new products and major features announced at our annual user conference, Dash, we are continuing to innovate at a rapid pace.” He further added, “We are broadening our observability platform, further developing our Cloud Security Platform, and launching the general availability of CI Visibility, which represents a major step towards shift-left observability for developer workflows.” Wall Street's Take Based on the upbeat Q3 results, Morgan Stanley analyst Sanjit Singh increased the price target on Datadog to $200 (7.8% upside potential) from $164, while reiterating a Buy rating. Singh attributed the price target hike to strong Q3 results, and increased FY2021 revenue growth outlook to 65%.
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Datadog, Inc. (DDOG) shares surged over 11% to close at $185.51 on November 5, approaching its 52-week high, after delivering blowout third-quarter results and raising its FY2021 outlook. (See Datadog stock charts on TipRanks) Similarly, revenues jumped 75% year-over-year to $270 million, exceeding consensus estimates of $247.73 million. Management Weighs In Sharing his views on new products and features, Datadog CEO, Olivier Pomel, commented, "With ten new products and major features announced at our annual user conference, Dash, we are continuing to innovate at a rapid pace.” He further added, “We are broadening our observability platform, further developing our Cloud Security Platform, and launching the general availability of CI Visibility, which represents a major step towards shift-left observability for developer workflows.” Wall Street's Take Based on the upbeat Q3 results, Morgan Stanley analyst Sanjit Singh increased the price target on Datadog to $200 (7.8% upside potential) from $164, while reiterating a Buy rating.
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Datadog, Inc. (DDOG) shares surged over 11% to close at $185.51 on November 5, approaching its 52-week high, after delivering blowout third-quarter results and raising its FY2021 outlook. The company now forecasts FY2021 adjusted earnings in the range of $0.39 to $0.40 per share, against the previous guidance range of $0.26 to $0.28 per share. Revenues are forecasted to be in the range of $993 million to $995 million, against the previously guided range of $938 million to $944 million.
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Datadog, Inc. (DDOG) shares surged over 11% to close at $185.51 on November 5, approaching its 52-week high, after delivering blowout third-quarter results and raising its FY2021 outlook. The company reported earnings of $0.05 per share in the same quarter last year. The company now forecasts FY2021 adjusted earnings in the range of $0.39 to $0.40 per share, against the previous guidance range of $0.26 to $0.28 per share.
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b7874be5-58ab-4993-abef-e275e878c493
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718806.0
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2021-11-05 00:00:00 UTC
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Why Datadog Stock Ran to a New All-Time High on Friday
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DDOG
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https://www.nasdaq.com/articles/why-datadog-stock-ran-to-a-new-all-time-high-on-friday-2021-11-05
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nan
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nan
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What happened
Shares of Datadog (NASDAQ: DDOG) charged sharply higher Friday, surging as much as 16.2% and hitting a new all-time high in the process. As of 1:28 p.m. EDT, the stock was up 11.5%.
The catalyst that drove the cloud monitoring and security company higher was third-quarter financial results that far exceeded expectations.
Image source: Getty Images.
So what
Datadog generated revenue of $270.5 million, up 75% year over year, squelching the idea that the stock was a "pandemic play." At the same time, the company delivered adjusted earnings per share (EPS) of $0.13, which surged 160%.
To give those numbers context, analysts' consensus estimates were calling for revenue of $247.73 million and adjusted EPS of $0.06.
The fuel that drove the impressive financial results were equally strong client metrics. Total customers of 17,500 increased 34% year over year. More importantly, however, Datadog ended the quarter with 1,800 customers that generate annual recurring revenue (ARR) of $100,000 or more, up 66% year over year. These are Datadog's most important customers, as they contribute 80% of the company's ARR.
Now what
Datadog gave investors another reason to cheer. The company significantly boosted its outlook going into the end of the year. Datadog now expects full-year revenue in a range of $993 million to $995 million, up from its previous guidance of $938 to $944 million. The company also boosted its bottom-line outlook, forecasting adjusted EPS in a range up $0.39 to $0.40, up from $0.27 at the midpoint of its previous guidance.
Management's ability to "beat and raise" -- beating analysts' expectations, while simultaneously raising guidance -- was enough to send Datadog charging to new heights.
I'd be remiss if I didn't point out that the stock isn't cheap by traditional metrics, with a forward valuation of 61, when a reasonable price-to-sales ratio is generally considered to be between 1 and 2. That said, management is forecasting year-over-year revenue growth of 65%, which may well be conservative given its history.
Investors with a stomach for a little volatility and a sufficiently long investing outlook might want to take this dog for a walk.
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Danny Vena owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of Datadog (NASDAQ: DDOG) charged sharply higher Friday, surging as much as 16.2% and hitting a new all-time high in the process. The catalyst that drove the cloud monitoring and security company higher was third-quarter financial results that far exceeded expectations. To give those numbers context, analysts' consensus estimates were calling for revenue of $247.73 million and adjusted EPS of $0.06.
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What happened Shares of Datadog (NASDAQ: DDOG) charged sharply higher Friday, surging as much as 16.2% and hitting a new all-time high in the process. Datadog now expects full-year revenue in a range of $993 million to $995 million, up from its previous guidance of $938 to $944 million. The company also boosted its bottom-line outlook, forecasting adjusted EPS in a range up $0.39 to $0.40, up from $0.27 at the midpoint of its previous guidance.
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What happened Shares of Datadog (NASDAQ: DDOG) charged sharply higher Friday, surging as much as 16.2% and hitting a new all-time high in the process. So what Datadog generated revenue of $270.5 million, up 75% year over year, squelching the idea that the stock was a "pandemic play." More importantly, however, Datadog ended the quarter with 1,800 customers that generate annual recurring revenue (ARR) of $100,000 or more, up 66% year over year.
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What happened Shares of Datadog (NASDAQ: DDOG) charged sharply higher Friday, surging as much as 16.2% and hitting a new all-time high in the process. Now what Datadog gave investors another reason to cheer. The company also boosted its bottom-line outlook, forecasting adjusted EPS in a range up $0.39 to $0.40, up from $0.27 at the midpoint of its previous guidance.
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4f7369af-0ec4-4594-8220-7ce52af690d3
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718807.0
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2021-11-05 00:00:00 UTC
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First Week of DDOG December 23rd Options Trading
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DDOG
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https://www.nasdaq.com/articles/first-week-of-ddog-december-23rd-options-trading-2021-11-05
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nan
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nan
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Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 23rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 23rd contracts and identified one put and one call contract of particular interest.
The put contract at the $165.00 strike price has a current bid of $4.70. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $165.00, but will also collect the premium, putting the cost basis of the shares at $160.30 (before broker commissions). To an investor already interested in purchasing shares of DDOG, that could represent an attractive alternative to paying $179.24/share today.
Because the $165.00 strike represents an approximate 8% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 71%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 2.85% return on the cash commitment, or 21.64% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Datadog Inc, and highlighting in green where the $165.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $185.00 strike price has a current bid of $8.20. If an investor was to purchase shares of DDOG stock at the current price level of $179.24/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $185.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 7.79% if the stock gets called away at the December 23rd expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $185.00 strike highlighted in red:
Considering the fact that the $185.00 strike represents an approximate 3% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 54%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 4.57% boost of extra return to the investor, or 34.76% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example is 51%, while the implied volatility in the call contract example is 54%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $179.24) to be 49%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $185.00 strike highlighted in red: Considering the fact that the $185.00 strike represents an approximate 3% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 23rd expiration.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $185.00 strike highlighted in red: Considering the fact that the $185.00 strike represents an approximate 3% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 23rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 23rd contracts and identified one put and one call contract of particular interest.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $185.00 strike highlighted in red: Considering the fact that the $185.00 strike represents an approximate 3% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 23rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 23rd contracts and identified one put and one call contract of particular interest.
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At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 23rd contracts and identified one put and one call contract of particular interest. Below is a chart showing DDOG's trailing twelve month trading history, with the $185.00 strike highlighted in red: Considering the fact that the $185.00 strike represents an approximate 3% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 23rd expiration.
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62945ef1-ae44-4bfb-b4a2-5dc880507ea3
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718808.0
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2021-11-04 00:00:00 UTC
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Noteworthy Thursday Option Activity: DDOG, DBRG, ELF
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DDOG
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https://www.nasdaq.com/articles/noteworthy-thursday-option-activity%3A-ddog-dbrg-elf-2021-11-04
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nan
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nan
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 19,221 contracts have traded so far, representing approximately 1.9 million underlying shares. That amounts to about 79.9% of DDOG's average daily trading volume over the past month of 2.4 million shares. Particularly high volume was seen for the $145 strike put option expiring November 05, 2021, with 2,037 contracts trading so far today, representing approximately 203,700 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange:
DigitalBridge Group Inc (Symbol: DBRG) options are showing a volume of 24,120 contracts thus far today. That number of contracts represents approximately 2.4 million underlying shares, working out to a sizeable 79.7% of DBRG's average daily trading volume over the past month, of 3.0 million shares. Especially high volume was seen for the $7.50 strike call option expiring January 21, 2022, with 10,117 contracts trading so far today, representing approximately 1.0 million underlying shares of DBRG. Below is a chart showing DBRG's trailing twelve month trading history, with the $7.50 strike highlighted in orange:
And e.l.f. Beauty Inc (Symbol: ELF) saw options trading volume of 3,028 contracts, representing approximately 302,800 underlying shares or approximately 78.3% of ELF's average daily trading volume over the past month, of 386,535 shares. Particularly high volume was seen for the $30 strike put option expiring November 19, 2021, with 1,892 contracts trading so far today, representing approximately 189,200 underlying shares of ELF. Below is a chart showing ELF's trailing twelve month trading history, with the $30 strike highlighted in orange:
For the various different available expirations for DDOG options, DBRG options, or ELF options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $145 strike put option expiring November 05, 2021, with 2,037 contracts trading so far today, representing approximately 203,700 underlying shares of DDOG. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 19,221 contracts have traded so far, representing approximately 1.9 million underlying shares. That amounts to about 79.9% of DDOG's average daily trading volume over the past month of 2.4 million shares.
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Particularly high volume was seen for the $145 strike put option expiring November 05, 2021, with 2,037 contracts trading so far today, representing approximately 203,700 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange: DigitalBridge Group Inc (Symbol: DBRG) options are showing a volume of 24,120 contracts thus far today. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 19,221 contracts have traded so far, representing approximately 1.9 million underlying shares.
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 19,221 contracts have traded so far, representing approximately 1.9 million underlying shares. Below is a chart showing ELF's trailing twelve month trading history, with the $30 strike highlighted in orange: For the various different available expirations for DDOG options, DBRG options, or ELF options, visit StockOptionsChannel.com. That amounts to about 79.9% of DDOG's average daily trading volume over the past month of 2.4 million shares.
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Below is a chart showing ELF's trailing twelve month trading history, with the $30 strike highlighted in orange: For the various different available expirations for DDOG options, DBRG options, or ELF options, visit StockOptionsChannel.com. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 19,221 contracts have traded so far, representing approximately 1.9 million underlying shares. That amounts to about 79.9% of DDOG's average daily trading volume over the past month of 2.4 million shares.
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8c4f540d-358f-41c4-80c0-c5ee488e38e1
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718809.0
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2021-11-04 00:00:00 UTC
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The Intersection of Big Data and On-Demand Services
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DDOG
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https://www.nasdaq.com/articles/the-intersection-of-big-data-and-on-demand-services-2021-11-04
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nan
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nan
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The digital future is one that is increasingly lived online. As such, the companies that succeed are the ones that not only know how to collect and organize deep, high-quality sets of data, but that can also refine that data into meaningful, actionable insight.
In 2020, approximately 64 zettabytes — or 6.4 trillion gigabytes — of data were created, an amount that would be utterly impossible to sift through and make sense of without the help of algorithms and AI, according to a research overview of big data refiners by ProShares.
That need for big data processing is only anticipated to grow, reports Expert Market Research. In 2020, the big data and business analytics market reached $208 billion; by 2026, it is forecast to grow to $450 billion, experiencing a compound annual growth rate of 10% each year.
In a NewVantage Partners survey made up of Fortune 1000 companies, 92% of corporate executives reported that their investments into AI and big data had increased, with 81% reporting that they were optimistic regarding the potential and future of AI and big data in their companies.
On-Demand Industry Projected for Growth
The COVID-19 pandemic altered a lot of habits for people who were suddenly homebound, and accordingly, the on-demand market saw a surge as more people were streaming a variety of services, from music and games to videos. On-demand services such as ride sharing also continued to grow.
ProShares estimates that the on-demand market is anticipated to grow to $604 billion by 2023, up from $403 billion in 2020. This number has been boosted by COVID-19 changes, but growth is anticipated to continue within the space on an upward velocity even after the effects of the pandemic subside.
With so many options for streaming services and so many devices available, the amount of time spent streaming videos has skyrocketed. Last year saw on-demand video streaming increase nearly 75%, with the amount of subscribers in the U.S. doubling between the beginning of 2019 and the end of 2020. A Fortune Business Insights report anticipates that theglobal marketfor on-demand video services will grow to $160 billion by 2027; in 2019, the market had a valuation of $54 billion.
In a world that is increasingly plugged in and generating enormous amounts of data based on consumption habits, analyzing how people are spending their time online or viewing media will be a crucial element for not only targeted advertising, but also in formulating meaningful growth for digital companies. The power of big data refiners to sift through massive amounts of information and glean helpful and meaningful insights will prove make-or-break for companies whose businesses depend on understanding and capitalizing on consumer habits.
Investing in Big Data and Digital Consumption
The ProShares Big Data Refiners ETF (DAT) invests in companies that work to assist other businesses in processing large amounts of data and pulling insightful information from the data collected. DAT seeks to track the FactSet Big Data Refiners Index, an index that is made up of companies that create the infrastructure and analytics to manage and extract information from the high-volume data sets being created constantly.
Companies within the index must derive 75% of their business from providing analytics, software, hardware, and other infrastructure that can manage and also pull information from large structured and unstructured data sets. If 25 companies that meet these requirements are not found within the sub-industries used to construct the index, the revenue threshold will be lowered to 50%.
Securities within the index are weighted based on their market cap up to a max of 4.5% for any singular company, and securities that meet market cap and liquidity requirements can come from U.S. and non-U.S. developed and emerging markets.
DAT carries an expense ratio of 0.58% and contains companies such as Datadog Inc at 7.17%, Mongodb Inc at 6.45%, and Dynatrace Inc at 5.99%.
The ProShares On-Demand ETF (OND) is the first ETF to invest in companies focused solely within the on-demand market, an industry that encompasses services such as video streaming and ride sharing.
OND seeks to track the FactSet On-Demand Index, an index that is comprised of companies that provide on-demand products and services in digital media, e-gaming, food delivery, fitness, ride sharing, or virtual reality experiences. Companies within the index must derive 75% of their business from products or services from one of 15 sub-industries that FactSet has classified as "on-demand." If 25 companies that meet these requirements are not found within the sub-industries used to construct the index, then the revenue threshold will be lowered to 50%.
Companies contained within the index are weighted according to their market cap, with a max of 4.5% for any single security, and companies that meet market cap and liquidity requirements can come from U.S. and non-U.S. developed and emerging markets.
OND carries an expense ratio of 0.58% and contains companies such as Doordash Inc (DASH) at 7.05%, Netflix Inc (NFLX) at 6.99%, and Spotify Technology (SPOT) at 6.43%.
For more news, information, and strategy, visit ETF Trends.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In a world that is increasingly plugged in and generating enormous amounts of data based on consumption habits, analyzing how people are spending their time online or viewing media will be a crucial element for not only targeted advertising, but also in formulating meaningful growth for digital companies. The power of big data refiners to sift through massive amounts of information and glean helpful and meaningful insights will prove make-or-break for companies whose businesses depend on understanding and capitalizing on consumer habits. Companies within the index must derive 75% of their business from providing analytics, software, hardware, and other infrastructure that can manage and also pull information from large structured and unstructured data sets.
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A Fortune Business Insights report anticipates that theglobal marketfor on-demand video services will grow to $160 billion by 2027; in 2019, the market had a valuation of $54 billion. Investing in Big Data and Digital Consumption The ProShares Big Data Refiners ETF (DAT) invests in companies that work to assist other businesses in processing large amounts of data and pulling insightful information from the data collected. DAT seeks to track the FactSet Big Data Refiners Index, an index that is made up of companies that create the infrastructure and analytics to manage and extract information from the high-volume data sets being created constantly.
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In a NewVantage Partners survey made up of Fortune 1000 companies, 92% of corporate executives reported that their investments into AI and big data had increased, with 81% reporting that they were optimistic regarding the potential and future of AI and big data in their companies. Investing in Big Data and Digital Consumption The ProShares Big Data Refiners ETF (DAT) invests in companies that work to assist other businesses in processing large amounts of data and pulling insightful information from the data collected. DAT seeks to track the FactSet Big Data Refiners Index, an index that is made up of companies that create the infrastructure and analytics to manage and extract information from the high-volume data sets being created constantly.
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On-demand services such as ride sharing also continued to grow. Investing in Big Data and Digital Consumption The ProShares Big Data Refiners ETF (DAT) invests in companies that work to assist other businesses in processing large amounts of data and pulling insightful information from the data collected. The ProShares On-Demand ETF (OND) is the first ETF to invest in companies focused solely within the on-demand market, an industry that encompasses services such as video streaming and ride sharing.
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43f1b113-c365-4a9d-8db7-5f04133e02cb
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718810.0
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2021-10-29 00:00:00 UTC
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DDOG Stock: 12 Things to Know About SaaS Play Datadog as Shares Pop
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DDOG
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https://www.nasdaq.com/articles/ddog-stock%3A-12-things-to-know-about-saas-play-datadog-as-shares-pop-2021-10-29
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nan
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nan
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Datadog (NASDAQ:DDOG) stock is on the move today and traders are going to want to keep track of the Software as a Service (SaaS) company in the company days.
Source: Karol Ciesluk / Shutterstock.com
We’ve got a quick breakdown below on what potential investors need to know about DDOG stock.
First off, let’s talk about the recent news that has DDOG stock on the rise today.
RBC Capital analyst Matthew Hedberg released a new price target for the stock after-hours Thursday.
This saw the analyst increasing his price target for the shares to $153 each from $130.
However, Hedberg maintained his sector perform rating for DDOG stock.
The reason for the price increase was a positive impression from the company’s Dash event this week.
Traders of DDOG stock are also gearing up for news next week as well.
7 Top Stocks to Buy On Any Dip If You Get the Chance in Q4
Datadog plans to release its earnings report for the third quarter of 2021 after markets close on Thursday.
The company will also hold a conference call at 5:00 p.m. Eastern Time that same day to go over its earnings.
Datadog is based out of New York City but has operating hubs all around the world.
Its business has it offering various services to businesses that include cloud integration.
This allows them to track metrics, clouds, servers, apps, and their team all in one place.
The company’s market capitalization is $52.114 billion.
DDOG stock was up 4.5% as of Friday afternoon and is sitting 84.4% higher since the start of the year.
There’s morestock market newsfor traders to sink their teeth into below!
It’s been a busy day of trading Friday but we’ve got all the most important news in one place. That includes Huadi International (NASDAQ:HUDI) taking a beating today, the top trending penny stocks for Friday, as well as what has QuantumScape (NYSE:QS) stock on the rise. You can get all that info from the following links!
More Friday Stock Market News
HUDI Stock Alert: 7 Things to Know as Huadi International Plunges 40%
Trending Penny Stocks for Friday: What’s Up With BEST, IDEX, MARK, UAVS, GFAI & MMAT Today?
QS Stock: 2 Big Reasons QuantumScape Is Powering Higher on Friday
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The post DDOG Stock: 12 Things to Know About SaaS Play Datadog as Shares Pop appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips Datadog (NASDAQ:DDOG) stock is on the move today and traders are going to want to keep track of the Software as a Service (SaaS) company in the company days. Source: Karol Ciesluk / Shutterstock.com We’ve got a quick breakdown below on what potential investors need to know about DDOG stock. First off, let’s talk about the recent news that has DDOG stock on the rise today.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips Datadog (NASDAQ:DDOG) stock is on the move today and traders are going to want to keep track of the Software as a Service (SaaS) company in the company days. Source: Karol Ciesluk / Shutterstock.com We’ve got a quick breakdown below on what potential investors need to know about DDOG stock. First off, let’s talk about the recent news that has DDOG stock on the rise today.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips Datadog (NASDAQ:DDOG) stock is on the move today and traders are going to want to keep track of the Software as a Service (SaaS) company in the company days. Source: Karol Ciesluk / Shutterstock.com We’ve got a quick breakdown below on what potential investors need to know about DDOG stock. First off, let’s talk about the recent news that has DDOG stock on the rise today.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips Datadog (NASDAQ:DDOG) stock is on the move today and traders are going to want to keep track of the Software as a Service (SaaS) company in the company days. Source: Karol Ciesluk / Shutterstock.com We’ve got a quick breakdown below on what potential investors need to know about DDOG stock. First off, let’s talk about the recent news that has DDOG stock on the rise today.
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191d84da-8446-4f83-9c37-53129f69e0c0
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718811.0
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2021-10-23 00:00:00 UTC
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2 Stocks to Buy to Capitalize on Data Transformation
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DDOG
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https://www.nasdaq.com/articles/2-stocks-to-buy-to-capitalize-on-data-transformation-2021-10-23
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nan
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nan
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With more data being produced by the day due to the shift to the cloud from on-premise systems, companies around the world are starting to struggle to manage it all and make the most of it. IDC, a subsidiary of Blackstone, estimates that digital transformation investments will approach a total of $6.8 trillion -- growing at a compound annual rate of 15.5% until 2023.
Two companies have the opportunity to capitalize on this investment growth by helping businesses. While they are doing so in very different ways, both are crucial to managing a successful enterprise. As the world obtains more data and digital information, these stocks should enjoy growth because of it.
Image source: Getty Images.
Workiva: Focusing on the necessities
Workiva (NYSE: WK) allows teams to navigate through the reporting process while increasing accuracy and efficiency and maintaining compliance throughout many different financial filings. It allows a business to consolidate all of its data onto one platform, making it easier to retrieve and report accurately. If you have ever read through Snowflake's S-1, for example, you have read something that was facilitated by Workiva's IPO filing solution.
The company does more than just handle IPO filings. It also provides environmental, social, and governance (ESG) reporting, internal audit management, Securities and Exchange Commission (SEC) reporting, and other filings that companies are obligated to disclose. Its customers use Workiva to create, review, and publish documents and reports with greater control, consistency, accuracy, and productivity. The company allows teams to do this collaboratively, increasing efficiency and mitigating risks of inaccuracies in their reports, which is crucial; 75% of the Fortune 500 trust Workiva to help them do this.
This trust from some of the largest companies in the world has made it a leader in its industry, according to the Forrester Wave report, and this dominance has led to strong financial success. In the second quarter of 2021, revenue grew 26% from the year ago to $106 million, with 13% of its customers spending over $150,000. Its customer count grew 10%, with a strong 2021 market for special purpose acquisition companies (SPACs) and IPOs being a driver of both revenue and customer growth.
The company is not profitable (it lost $9.5 million in the second quarter of 2021), but its growth potential and recurring revenue will likely allow the company to maintain its trend toward profitability. Many of Workiva's customers will have to continue filing financial documents, and it's unlikely they will switch from Workiva; the company's churn rate is just 5%.
Workiva is likely the first place that companies go to improve their reporting processes because of its market leadership. So as long as there are new companies going public in the U.S., Canada, the Asia-Pacific region, and Europe -- all places where the company operates -- it will have a new supply of customers. Even though it trades at 19 times sales, Workiva is likely to be one of the major benefactors of an increasing amount of data that companies receive and need to report to regulators.
Datadog: An innovation facilitator
With increases in amounts of data, it can be difficult for a company to monitor the performance of its applications and infrastructure. It is crucial that a company's applications are running properly, but with a growing abundance of data, it can be hard for IT teams to spot those problems right away. This is one aspect of observability that Datadog (NASDAQ: DDOG) helps with.
The company has enabled IT teams to monitor performance and manage everything they need -- from infrastructure to user experiences -- all on one platform. Users are able to spot problems and realize key insights to improve their software, which helps developers and IT teams immensely. This value proposition is likely why Datadog has a net revenue retention rate of over 130%, and why its number of customers spending over $100,000 grew nearly 60% to 1,610 during the second quarter of 2021 compared to the year-ago quarter.
The company grew revenue 67% to $234 million in the quarter, and its net income margin was just negative 4% for the quarter. With gross margins of 76% and strong free cash flow -- its free cash flow so far in 2021 has grown 127% to $42.3 million from the first six months of 2020 -- the company is on track to achieve continuous profitability.
Like Workiva, Datadog's dominant leadership position according to Gartner's 2021 Magic Quadrant for Application Performance Monitoring and its strong financial performance command a hefty valuation of 63 times sales, which would make any investor do a double-take. However, the company has the growth potential to back up that valuation. Datadog is known for creating new solutions (it has come up with two new monitoring platforms since August, adding to its 13 solutions). If the company can make its services even more vital to IT teams than they already are, it's likely to see amazing success for many more years.
10 stocks we like better than Datadog
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They just revealed what they believe are the ten best stocks for investors to buy right now… and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of October 20, 2021
Jamie Louko owns shares of Datadog and Snowflake Inc. The Motley Fool owns shares of and recommends Datadog, Snowflake Inc., and Workiva. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This is one aspect of observability that Datadog (NASDAQ: DDOG) helps with. With more data being produced by the day due to the shift to the cloud from on-premise systems, companies around the world are starting to struggle to manage it all and make the most of it. The company allows teams to do this collaboratively, increasing efficiency and mitigating risks of inaccuracies in their reports, which is crucial; 75% of the Fortune 500 trust Workiva to help them do this.
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This is one aspect of observability that Datadog (NASDAQ: DDOG) helps with. With gross margins of 76% and strong free cash flow -- its free cash flow so far in 2021 has grown 127% to $42.3 million from the first six months of 2020 -- the company is on track to achieve continuous profitability. Like Workiva, Datadog's dominant leadership position according to Gartner's 2021 Magic Quadrant for Application Performance Monitoring and its strong financial performance command a hefty valuation of 63 times sales, which would make any investor do a double-take.
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This is one aspect of observability that Datadog (NASDAQ: DDOG) helps with. The company allows teams to do this collaboratively, increasing efficiency and mitigating risks of inaccuracies in their reports, which is crucial; 75% of the Fortune 500 trust Workiva to help them do this. The company is not profitable (it lost $9.5 million in the second quarter of 2021), but its growth potential and recurring revenue will likely allow the company to maintain its trend toward profitability.
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This is one aspect of observability that Datadog (NASDAQ: DDOG) helps with. Two companies have the opportunity to capitalize on this investment growth by helping businesses. Like Workiva, Datadog's dominant leadership position according to Gartner's 2021 Magic Quadrant for Application Performance Monitoring and its strong financial performance command a hefty valuation of 63 times sales, which would make any investor do a double-take.
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a45f334e-6bb9-4d4f-8bba-406728bc9ef7
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718812.0
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2021-10-23 00:00:00 UTC
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Investing in This ETF Right Now Could Make You a Millionaire Retiree
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DDOG
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https://www.nasdaq.com/articles/investing-in-this-etf-right-now-could-make-you-a-millionaire-retiree-2021-10-23
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nan
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nan
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Retiring with a million dollars is a good goal. A larger or smaller sum might work well for you, but for many, if not most, of us, a million dollars will go far. If you apply the flawed-but-still-useful 4% rule to it, withdraw 4% of that million dollars in your first year of retirement, and adjust the withdrawal for inflation in each successive year, the money stands a good chance of supporting you for several decades. And that first 4% withdrawal will be... $40,000.
So how can you amass $1 million by retirement? Well, there are many paths to get there, and one of them is investing in an exchange-traded fund (ETF) (or two) that can grow effectively for you over the long run. Here's a look at some such ETFs.
Image source: Getty Images.
The lower-risk ETF
First, one of the best investment strategies for most people is simply to stick with low-cost index funds. They require little of your brainpower and will deliver roughly the same return as the overall market, less those low fees. The stock market has an average annual growth rate of close to 10% over long periods, which can grow your wealth at a decent clip. Over your investing time frame, though, it might average less (or more!) than 10%. So to be a bit conservative, here's how your money might grow at 8%:
GROWING AT 8% FOR
$5,000 INVESTED ANNUALLY
$10,000 INVESTED ANNUALLY
$15,000 INVESTED ANNUALLY
5 years
$31,680
$63,359
$95,039
10 years
$78,227
$156,455
$234,682
15 years
$146,621
$293,243
$439,864
20 years
$247,115
$494,229
$741,344
25 years
$394,772
$789,544
$1.2 million
30 years
$611,729
$1.2 million
$1.8 million
35 years
$930,511
$1.9 million
$2.8 million
40 years
$1.4 million
$2.8 million
$4.2 million
Calculations by author.
Here's one such ETF to consider: the SPDR S&P 500 ETF (NYSEMKT: SPY). It follows the S&P 500 index, which is often used as a proxy for the overall U.S. market, since its components together make up about 80% of the total value of the U.S. stock market.
Image source: Getty Images.
The higher-risk ETF
You can do very well investing regularly in a low-risk, low-fee index fund for many years. But if you want to aim for even better returns and are willing to take on a little more risk, you might consider an ETF focused on a faster-growing segment of the market. The Invesco NASDAQ Next Gen 100 ETF (NASDAQ: QQQJ) is one candidate to consider.
Here's how the folks at Invesco describe the fund:
The Invesco NASDAQ Next Gen 100 Fund (Fund) is based on the NASDAQ Next Generation 100 Index (Index). The Fund will invest at least 90% of its total assets in the securities that comprise the Index by investing in the 101st to the 200th largest companies on the NASDAQ. As a result, the portfolio may be concentrated in mid-capitalization stocks. The Index is comprised of securities of the next generation of Nasdaq-listed non-financial companies; that is, the largest 100 Nasdaq-listed companies outside of the NASDAQ-100 Index®.
Got it? It essentially skips the biggest and most well-known Nasdaq companies, such as Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), and Amazon.com (NASDAQ: AMZN), which together make up roughly 30% of the Nasdaq 100. By doing so, it can focus on relatively smaller companies, such as mid-caps, many of which may be on their way to becoming huge and powerful, but aren't quite there yet.
Its top holdings recently featured:
Fortinet
Zscaler
Roku
Datadog
Old Dominion Freight Line
The Trade Desk
MongoDB
Garmin
Etsy
Zebra Technologies
The fund is very new, so there isn't much of a track record to look at, but you'll probably notice a few familiar growth stocks among its top 10 -- as strong performers in recent years. TV streaming service Roku, for example, has surged around 1,366% over the past five years -- nearly 94% annually, on average. For cybersecurity concern Fortinet, those numbers are 950% and 60%, respectively, and for database specialist Mongo DB, they're 1,471% and 99%.
The fund's future performance is unknown, and a market crash will likely hit recent high flyers hard, but over the long run, there's a decent chance that this group of 100 companies will reward shareholders.
This isn't an either-or situation, so you can always invest in both a broad-market ETF and one or more specialized ones. Perhaps park much of your portfolio in the broad market and aim to juice your returns with one or more carefully selected focused ETFs.
10 stocks we like better than MongoDB
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They just revealed what they believe are the ten best stocks for investors to buy right now... and MongoDB wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of September 17, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Selena Maranjian owns shares of Amazon, Apple, Datadog, Microsoft, MongoDB, and The Trade Desk. The Motley Fool owns shares of and recommends Amazon, Apple, Datadog, Etsy, Microsoft, MongoDB, Old Dominion Freight Line, Roku, The Trade Desk, Zebra Technologies, and Zscaler. The Motley Fool recommends Fortinet and Garmin and recommends the following options: long January 2022 $1,920 calls on Amazon, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The stock market has an average annual growth rate of close to 10% over long periods, which can grow your wealth at a decent clip. The fund's future performance is unknown, and a market crash will likely hit recent high flyers hard, but over the long run, there's a decent chance that this group of 100 companies will reward shareholders. The Motley Fool owns shares of and recommends Amazon, Apple, Datadog, Etsy, Microsoft, MongoDB, Old Dominion Freight Line, Roku, The Trade Desk, Zebra Technologies, and Zscaler.
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5 years $31,680 $63,359 $95,039 10 years $78,227 $156,455 $234,682 15 years $146,621 $293,243 $439,864 20 years $247,115 $494,229 $741,344 25 years $394,772 $789,544 $1.2 million 30 years $611,729 $1.2 million $1.8 million 35 years $930,511 $1.9 million $2.8 million 40 years $1.4 million $2.8 million $4.2 million Calculations by author. The Motley Fool owns shares of and recommends Amazon, Apple, Datadog, Etsy, Microsoft, MongoDB, Old Dominion Freight Line, Roku, The Trade Desk, Zebra Technologies, and Zscaler. The Motley Fool recommends Fortinet and Garmin and recommends the following options: long January 2022 $1,920 calls on Amazon, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, and short March 2023 $130 calls on Apple.
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5 years $31,680 $63,359 $95,039 10 years $78,227 $156,455 $234,682 15 years $146,621 $293,243 $439,864 20 years $247,115 $494,229 $741,344 25 years $394,772 $789,544 $1.2 million 30 years $611,729 $1.2 million $1.8 million 35 years $930,511 $1.9 million $2.8 million 40 years $1.4 million $2.8 million $4.2 million Calculations by author. It essentially skips the biggest and most well-known Nasdaq companies, such as Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), and Amazon.com (NASDAQ: AMZN), which together make up roughly 30% of the Nasdaq 100. Its top holdings recently featured: Fortinet Zscaler Roku Datadog Old Dominion Freight Line The Trade Desk MongoDB Garmin Etsy Zebra Technologies The fund is very new, so there isn't much of a track record to look at, but you'll probably notice a few familiar growth stocks among its top 10 -- as strong performers in recent years.
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Well, there are many paths to get there, and one of them is investing in an exchange-traded fund (ETF) (or two) that can grow effectively for you over the long run. The stock market has an average annual growth rate of close to 10% over long periods, which can grow your wealth at a decent clip. The Fund will invest at least 90% of its total assets in the securities that comprise the Index by investing in the 101st to the 200th largest companies on the NASDAQ.
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51a2a13f-934e-4c6a-9476-463ed3539668
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718813.0
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2021-10-22 00:00:00 UTC
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First Week of DDOG December 3rd Options Trading
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DDOG
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https://www.nasdaq.com/articles/first-week-of-ddog-december-3rd-options-trading-2021-10-22
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nan
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nan
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Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 3rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 3rd contracts and identified one put and one call contract of particular interest.
The put contract at the $160.00 strike price has a current bid of $9.60. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $160.00, but will also collect the premium, putting the cost basis of the shares at $150.40 (before broker commissions). To an investor already interested in purchasing shares of DDOG, that could represent an attractive alternative to paying $161.91/share today.
Because the $160.00 strike represents an approximate 1% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 56%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 6.00% return on the cash commitment, or 52.09% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Datadog Inc, and highlighting in green where the $160.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $165.00 strike price has a current bid of $9.00. If an investor was to purchase shares of DDOG stock at the current price level of $161.91/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $165.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 7.47% if the stock gets called away at the December 3rd expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $165.00 strike highlighted in red:
Considering the fact that the $165.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 51%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 5.56% boost of extra return to the investor, or 48.26% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example, as well as the call contract example, are both approximately 51%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $161.91) to be 50%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $165.00 strike highlighted in red: Considering the fact that the $165.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 3rd expiration.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $165.00 strike highlighted in red: Considering the fact that the $165.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 3rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 3rd contracts and identified one put and one call contract of particular interest.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $165.00 strike highlighted in red: Considering the fact that the $165.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 3rd expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 3rd contracts and identified one put and one call contract of particular interest.
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At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new December 3rd contracts and identified one put and one call contract of particular interest. Below is a chart showing DDOG's trailing twelve month trading history, with the $165.00 strike highlighted in red: Considering the fact that the $165.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the December 3rd expiration.
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e86c0d14-f497-4dd3-b9e0-10a7c9b32115
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718814.0
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2021-10-18 00:00:00 UTC
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Datadog Earnings: What to Watch
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DDOG
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https://www.nasdaq.com/articles/datadog-earnings%3A-what-to-watch-2021-10-18
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nan
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nan
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Datadog (NASDAQ: DDOG) reports its earnings on Nov. 4, in an announcement that should include head-turning growth metrics.
In this video from "The Five" from Motley Fool Live, recorded on Oct. 12, Fool contributors Brian Withers and Demitri Kalogeropoulos discuss the main factors to watch in the cloud-services giant's upcoming report.
10 stocks we like better than Datadog
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of September 17, 2021
Brian Withers: For me, it's just Datadog and for no reason other than they're just a player that is really riding the tailwinds of cloud. As more and more companies go to the cloud and have maybe some other business and on-premise and getting other cloud things from potentially multiple cloud providers, Datadog is a great company to provide you insights into all of those information technology operations across your enterprise.
It just gets to a point where companies, I think, need Datadog just to keep tabs on the complexity of companies' information technology infrastructure is just getting more and more with more different sources of where these things can go and demand of employees being able to work from anywhere. IT organizations are stretched to provide reliable, capable, and secure services across our enterprise.
Datadog is a great way to do that and they're continuing to innovate. They added a couple of more new products last quarter. They have some really stellar growth rates that they are targeting. It's a very rich stock from a price-to-sales perspective.
But they have so many things going for them, and it's one of my holdings that I've recently bought that I'm excited about and just want to keep better tabs on the company.
Demitri Kalogeropoulos: Interesting. That's the first I've looked at Datadog. I had no idea it's a $45 billion market cap. That's a big company. It looks like they're supposed to grow earnings over 70% this quarter. That's amazing.
Withers: They are absolutely a high-growth company, and you don't have to know much about them really, but to understand that they're into the observability, which is really going out and looking at your systems and understanding what's going on with them and helping them fend off problems before they become bigger issues.
Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG) reports its earnings on Nov. 4, in an announcement that should include head-turning growth metrics. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. IT organizations are stretched to provide reliable, capable, and secure services across our enterprise.
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Datadog (NASDAQ: DDOG) reports its earnings on Nov. 4, in an announcement that should include head-turning growth metrics. In this video from "The Five" from Motley Fool Live, recorded on Oct. 12, Fool contributors Brian Withers and Demitri Kalogeropoulos discuss the main factors to watch in the cloud-services giant's upcoming report. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.
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Datadog (NASDAQ: DDOG) reports its earnings on Nov. 4, in an announcement that should include head-turning growth metrics. 10 stocks we like better than Datadog When our award-winning analyst team has a stock tip, it can pay to listen. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Brian Withers: For me, it's just Datadog and for no reason other than they're just a player that is really riding the tailwinds of cloud.
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Datadog (NASDAQ: DDOG) reports its earnings on Nov. 4, in an announcement that should include head-turning growth metrics. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. That's right -- they think these 10 stocks are even better buys.
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ee7b20a1-5263-4118-bb52-8f2b8752237d
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718815.0
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2021-10-18 00:00:00 UTC
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Doge vs. Dog -- Which One Is Worth Buying?
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DDOG
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https://www.nasdaq.com/articles/doge-vs.-dog-which-one-is-worth-buying-2021-10-18
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nan
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nan
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After what seems to be like a pump-and-dump scheme, the cryptocurrency Dogecoin (CRYPTO: DOGE) has been bid up almost 4,000% since the start of 2021 by meme-stock traders. This cryptocurrency, unlike other cryptos like Ethereum, has almost no real-world use, so Doge's price jump has been largely unreasonable.
What has also been quite irrational is the volatility of the Dogecoin stock price. Even though it is up nearly 4,000% today, it was up 12,000% in May. The likely culprit of its fall has been that the hype around Doge has fallen since its May peak. It is safe to say that the rises and falls of Doge's price are largely due to hype and trader sentiment, rather than fundamentals.
Observability platform Datadog (NASDAQ: DDOG), on the other hand, is a company that has plenty of real-world use cases. Its tools to help IT teams have proved to be extremely valuable, which is why investors should be dumping Doge in favor of Datadog.
Image source: Getty Images.
Datadog's real-world applications
As more companies shift to operating on the cloud and their infrastructure becomes more complex, it can be difficult to monitor the performance of their applications and infrastructure. Datadog's platform allows developers and operations teams to monitor performance and act on it. With its "three pillars of observability," the company has enabled IT teams to monitor everything they need -- from infrastructure to user experiences -- all on one platform.
What does all of this mean? With software beginning to dominate the business world, IT and developer teams are beginning to drown in data. The software creates logs -- which are simply massive houses of data from the software about what it is doing at any given second -- all the time. Datadog sifts through these logs and breaks them down onto one screen, where teams can easily monitor many things like its infrastructure, application performance, user experience, and network performance.
This easy-to-understand view of the data allows teams to actually act on it -- which is the whole purpose of data! Most importantly, it allows IT teams to spot problems easier. If an application is not working, the IT team can easily spot that and fix it. Datadog's platform also spots trends and correlations in the data which allows its customers to take action by developing new applications. Another major benefit that Datadog provides is the ability to easily understand user behavior and track key business metrics. Because of all of these benefits Datadog provides, 16,400 IT teams have become customers.
Price growth for a reason
While Datadog's share price has not grown as fast as Dogecoin's price -- shares have increased roughly 58% since the start of 2021 -- its share price has risen for a reason, which cannot be said about Dogecoin. Datadog has had a stellar 2021, with its second-quarter 2021 earnings beating Wall Street expectations on both the top and bottom lines.
The company grew its Q2 2021 revenue 65% to $234 million from the year-ago quarter, with its customers paying over $100,000 soaring 59% to 1,610. Its net revenue retention was above 130% -- meaning that customers spent 30% more in Q2 2021 than they did in the year-ago period -- which shows how valuable and trusted Datadog's platform is.
Datadog's gross margins for Q2 were 76%, and while the company had a net loss in Q2, it was very small -- representing just 4% of revenue. With its strong gross margins and a Q2 free cash flow of $42 million, the company could reach profitability very soon. The company reported strong guidance for its full-year during its Q2 earnings release -- raising its revenue guidance by 6% from the guidance it announced in the first quarter of 2021. This estimate -- which is for 2021 revenue to reach roughly $941 million -- would represent an increase of 56% from its 2020 revenue.
Datadog's bright future
Gartner estimates that the IT operations management market is going to be worth $44 billion by 2024, and with just $764 million in trailing-12-month revenue, the company has just 1.7% of that market today. Even with over 16,000 customers, the company still has plenty of room to grow its customer base.
Additionally, the company is investing heavily in developing new services for increased observability. The company has invested $174 million in the research and development of new products so far in 2021. And with high loyalty within its customer base, its customers could adopt these products and dive even deeper into the company's product ecosystem.
The company's high valuation of 62 times sales is high when compared to many stocks in the application performance monitoring space. When compared to Dynatrace (NYSE: DT) -- a Datadog competitor trading at 29 times sales -- it is clear just how expensive Datadog really is. This steep valuation might scare off some investors, but as a market leader -- according to Gartner's Magic Quadrant -- Datadog is rapidly growing revenue while its customers are spending more and more each year, giving some reason behind its price.
Datadog's share price has fluctuated much less than Doge's, so an investment in the company would likely provide much more stability to an investor's long-term portfolio than Doge would. When compared to a cryptocurrency with little real-world use, immense volatility, and irrational growth, it is clear that Datadog is the investment worth making out of the two.
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They just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of September 17, 2021
Jamie Louko owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog and Ethereum. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Observability platform Datadog (NASDAQ: DDOG), on the other hand, is a company that has plenty of real-world use cases. Another major benefit that Datadog provides is the ability to easily understand user behavior and track key business metrics. Its net revenue retention was above 130% -- meaning that customers spent 30% more in Q2 2021 than they did in the year-ago period -- which shows how valuable and trusted Datadog's platform is.
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Observability platform Datadog (NASDAQ: DDOG), on the other hand, is a company that has plenty of real-world use cases. Datadog's platform allows developers and operations teams to monitor performance and act on it. Price growth for a reason While Datadog's share price has not grown as fast as Dogecoin's price -- shares have increased roughly 58% since the start of 2021 -- its share price has risen for a reason, which cannot be said about Dogecoin.
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Observability platform Datadog (NASDAQ: DDOG), on the other hand, is a company that has plenty of real-world use cases. Price growth for a reason While Datadog's share price has not grown as fast as Dogecoin's price -- shares have increased roughly 58% since the start of 2021 -- its share price has risen for a reason, which cannot be said about Dogecoin. Datadog's bright future Gartner estimates that the IT operations management market is going to be worth $44 billion by 2024, and with just $764 million in trailing-12-month revenue, the company has just 1.7% of that market today.
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Observability platform Datadog (NASDAQ: DDOG), on the other hand, is a company that has plenty of real-world use cases. Datadog's platform allows developers and operations teams to monitor performance and act on it. Datadog's platform also spots trends and correlations in the data which allows its customers to take action by developing new applications.
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9b87a522-515a-4d27-a28f-5cf71f9d5817
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718816.0
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2021-10-15 00:00:00 UTC
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Why Coupa Software, Zendesk, and Other High-Growth Tech Stocks Caught Fire This Week
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DDOG
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https://www.nasdaq.com/articles/why-coupa-software-zendesk-and-other-high-growth-tech-stocks-caught-fire-this-week-2021-10
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nan
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nan
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What happened
After spending several weeks caught in a downdraft, a number of technology stocks are sharply higher this week, as investors are on the prowl for bargains.
Here's a look at how some volatile, high-growth stocks are faring so far this week, according to data from S&P Global Market Intelligence:
Coupa Software (NASDAQ: COUP), up 14.5%.
Zendesk (NYSE: ZEN), up 11.4%.
Datadog (NASDAQ: DDOG), up 9.3%.
MongoDB (NASDAQ: MDB), up 9%.
The Trade Desk (NASDAQ: TTD), up 8.6%.
Image source: Getty Images.
So what
There wasn't much in the way of company-specific news driving these stocks higher, but there's a common theme that was evident in the preceding two weeks, which might help explain the trend.
Database specialist MongoDB had slumped 11.6%, with a price-to-sales (P/S) ratio of 39.
Business-spend management platform Coupa Software tumbled roughly 9.8%, trading at 25 times sales.
Customer support specialist Zendesk fell 8.5%, changing hands at 11 times sales.
Digital advertising kingpin The Trade Desk declined 7.1%, with a P/S of 34.
Cloud monitoring specialist Datadog dropped 4.8%, trading at 56 times sales.
To give those numbers context, the S&P 500 declined 1.4% during the same period, while the tech-heavy Nasdaq Composite lost 3.1% of its value. Additionally, a good P/S ratio is typically between 1 and 2, so each of these stocks was on the pricey side, helping add to the downward pressure.
September was a brutal month for technology stocks, causing the Nasdaq to lose 5.3% of its value. The rout continued into the early part of October, before these fast-growers were able to regain their footing.
Data by YCharts.
Now what
What caused those initial steep declines? The yield on U.S. Treasuries spiked during the same period, climbing to its highest level in months, making bonds more attractive. The flight to safety increased as investors grew more apprehensive about the potential for a prolonged period of inflation.
That fear was exacerbated last month when Federal Reserve Chairman Jerome Powell, in remarks before the U.S. Senate, warned that supply chain issues might push inflation higher over the short term. "Inflation is elevated and will likely remain so in coming months before moderating," he said.
Additionally, each of the highfliers beat the broader market indexes in 2020, with four of the five notching triple-digit gains. The Trade Desk, MongoDB, and Datadog surged 208%, 173%, and 161%, respectively. Similarly, Coupa Software and Zendesk soared 132% and 87%, respectively. The common thread that unites these companies is their cloud-based offerings, which are in high demand during the pandemic. After such notable gains, some investors sold shares in an effort to lock in gains.
After the recent multiweek downturn, particularly among high-growth stocks, most of these companies were selling at a discount, with investors moving in to scoop up the bargains.
It's important to note that each of these companies is positioning itself to succeed over the long term, regardless of short-term headwinds like inflation rates or bond yields. Over the long term, stock prices will follow business performance -- and each of these companies is doing just fine.
10 stocks we like better than The Trade Desk
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They just revealed what they believe are the ten best stocks for investors to buy right now... and The Trade Desk wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of September 17, 2021
Danny Vena owns shares of Datadog, MongoDB, and The Trade Desk. The Motley Fool owns shares of and recommends Coupa Software, Datadog, MongoDB, The Trade Desk, and Zendesk. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG), up 9.3%. Here's a look at how some volatile, high-growth stocks are faring so far this week, according to data from S&P Global Market Intelligence: Coupa Software (NASDAQ: COUP), up 14.5%. So what There wasn't much in the way of company-specific news driving these stocks higher, but there's a common theme that was evident in the preceding two weeks, which might help explain the trend.
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Datadog (NASDAQ: DDOG), up 9.3%. Cloud monitoring specialist Datadog dropped 4.8%, trading at 56 times sales. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Danny Vena owns shares of Datadog, MongoDB, and The Trade Desk.
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Datadog (NASDAQ: DDOG), up 9.3%. 10 stocks we like better than The Trade Desk When our award-winning analyst team has a stock tip, it can pay to listen. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Danny Vena owns shares of Datadog, MongoDB, and The Trade Desk.
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Datadog (NASDAQ: DDOG), up 9.3%. What happened After spending several weeks caught in a downdraft, a number of technology stocks are sharply higher this week, as investors are on the prowl for bargains. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Danny Vena owns shares of Datadog, MongoDB, and The Trade Desk.
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72a9bef4-859a-44d4-a4b0-f450b07dd1b3
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718817.0
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2021-10-10 00:00:00 UTC
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Is PagerDuty Stock Undervalued?
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DDOG
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https://www.nasdaq.com/articles/is-pagerduty-stock-undervalued-2021-10-10
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nan
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nan
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At a market cap of just $3.5 billion, PagerDuty (NYSE: PD) is one of the smaller cloud stocks you'll find, and at a price-to-sales valuation of 15, it's cheaper than many of its competitors, including Datadog.
But does that make it a buy? In this episode of "The Five," recorded on Sept. 3, Fool contributors Jeremy Bowman and Brian Withers discuss how PagerDuty stacks up following its second-quarter earnings report.
10 stocks we like better than PagerDuty
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and PagerDuty wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of September 17, 2021
Brian Withers: I saw a question over here, well, a question or a comment from Curmudgeon on PagerDuty. Jeremy, you didn't tell me this, so I'm upset. [laughs]
Jeremy Bowman: I wanted to get to that actually, but we were on the online argument.
Withers: Yeah, go ahead. I want to steal your thunder.
Bowman: I think he much makes a good point, PagerDuty has a much smaller market cap than some of these companies we were talking about on Beat and Raise with only about four billion dollars. I think partly that's a reflection that the business is smaller. I think as I was talking about, maybe there's signs that it could be potentially exhausted or it might be running out of new customers to add with the majority of the Fortune 100 already in its business. Its valuation is smaller than some of its peers and it's still trading for price to sales of 15, which for cloud stocks is pretty low, for the market in general is pretty high. I think in some ways it does leave some runway for growth, especially if we see it rolling out some new products. Really if we see that net retention rate remain high and are even growing. I think that's a very great sign for it to be multi-bagging stock.
Withers: Yes. Let's compare PagerDuty at a four billion market cap. Do you happen to know what Datadog's market cap is?
Bowman: Pretty sure it's a lot higher, [laughs] yes.
Withers: It's like 10 times higher, 10 times. They're going after a little bit of the same market. Both Datadog and PagerDuty talk about observability and being proactive and getting insights from your network and what's going on. It's a massive market. Datadog's price of sales is 55. You just said PagerDuty is 15. Yeah, that's an interesting one.
Brian Withers owns shares of Datadog. Jeremy Bowman owns shares of PagerDuty. The Motley Fool owns shares of and recommends Datadog and PagerDuty. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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At a market cap of just $3.5 billion, PagerDuty (NYSE: PD) is one of the smaller cloud stocks you'll find, and at a price-to-sales valuation of 15, it's cheaper than many of its competitors, including Datadog. In this episode of "The Five," recorded on Sept. 3, Fool contributors Jeremy Bowman and Brian Withers discuss how PagerDuty stacks up following its second-quarter earnings report. Bowman: I think he much makes a good point, PagerDuty has a much smaller market cap than some of these companies we were talking about on Beat and Raise with only about four billion dollars.
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In this episode of "The Five," recorded on Sept. 3, Fool contributors Jeremy Bowman and Brian Withers discuss how PagerDuty stacks up following its second-quarter earnings report. Brian Withers owns shares of Datadog. Jeremy Bowman owns shares of PagerDuty.
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At a market cap of just $3.5 billion, PagerDuty (NYSE: PD) is one of the smaller cloud stocks you'll find, and at a price-to-sales valuation of 15, it's cheaper than many of its competitors, including Datadog. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Brian Withers: I saw a question over here, well, a question or a comment from Curmudgeon on PagerDuty. Bowman: I think he much makes a good point, PagerDuty has a much smaller market cap than some of these companies we were talking about on Beat and Raise with only about four billion dollars.
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That's right -- they think these 10 stocks are even better buys. Do you happen to know what Datadog's market cap is? You just said PagerDuty is 15.
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f81dd90f-5056-4d84-b8b2-98f330f2d0ae
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718818.0
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2021-10-08 00:00:00 UTC
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Notable Friday Option Activity: DDOG, PTON, SCHN
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DDOG
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https://www.nasdaq.com/articles/notable-friday-option-activity%3A-ddog-pton-schn-2021-10-08
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nan
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nan
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 12,159 contracts has been traded thus far today, a contract volume which is representative of approximately 1.2 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 48.7% of DDOG's average daily trading volume over the past month, of 2.5 million shares. Particularly high volume was seen for the $142 strike put option expiring October 08, 2021, with 2,726 contracts trading so far today, representing approximately 272,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $142 strike highlighted in orange:
Peloton Interactive Inc (Symbol: PTON) options are showing a volume of 39,060 contracts thus far today. That number of contracts represents approximately 3.9 million underlying shares, working out to a sizeable 48.5% of PTON's average daily trading volume over the past month, of 8.1 million shares. Especially high volume was seen for the $87 strike call option expiring October 08, 2021, with 1,894 contracts trading so far today, representing approximately 189,400 underlying shares of PTON. Below is a chart showing PTON's trailing twelve month trading history, with the $87 strike highlighted in orange:
And Schnitzer Steel Industries Inc (Symbol: SCHN) saw options trading volume of 1,322 contracts, representing approximately 132,200 underlying shares or approximately 48.1% of SCHN's average daily trading volume over the past month, of 274,975 shares. Particularly high volume was seen for the $30 strike put option expiring February 18, 2022, with 250 contracts trading so far today, representing approximately 25,000 underlying shares of SCHN. Below is a chart showing SCHN's trailing twelve month trading history, with the $30 strike highlighted in orange:
For the various different available expirations for DDOG options, PTON options, or SCHN options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $142 strike put option expiring October 08, 2021, with 2,726 contracts trading so far today, representing approximately 272,600 underlying shares of DDOG. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 12,159 contracts has been traded thus far today, a contract volume which is representative of approximately 1.2 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 48.7% of DDOG's average daily trading volume over the past month, of 2.5 million shares.
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Particularly high volume was seen for the $142 strike put option expiring October 08, 2021, with 2,726 contracts trading so far today, representing approximately 272,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $142 strike highlighted in orange: Peloton Interactive Inc (Symbol: PTON) options are showing a volume of 39,060 contracts thus far today. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 12,159 contracts has been traded thus far today, a contract volume which is representative of approximately 1.2 million underlying shares (given that every 1 contract represents 100 underlying shares).
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 12,159 contracts has been traded thus far today, a contract volume which is representative of approximately 1.2 million underlying shares (given that every 1 contract represents 100 underlying shares). Particularly high volume was seen for the $142 strike put option expiring October 08, 2021, with 2,726 contracts trading so far today, representing approximately 272,600 underlying shares of DDOG. That number works out to 48.7% of DDOG's average daily trading volume over the past month, of 2.5 million shares.
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Below is a chart showing SCHN's trailing twelve month trading history, with the $30 strike highlighted in orange: For the various different available expirations for DDOG options, PTON options, or SCHN options, visit StockOptionsChannel.com. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 12,159 contracts has been traded thus far today, a contract volume which is representative of approximately 1.2 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 48.7% of DDOG's average daily trading volume over the past month, of 2.5 million shares.
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b858d862-4f95-4da1-92c5-85832ae20697
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718819.0
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2021-10-06 00:00:00 UTC
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This Growth Stock Could Turn $100,000 Into $1 Million by 2031
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DDOG
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https://www.nasdaq.com/articles/this-growth-stock-could-turn-%24100000-into-%241-million-by-2031-2021-10-06
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nan
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Last year, the pandemic proved the importance of a digital-first business model. More consumers are shopping online and connecting with brands through the internet, and companies that hope to win and maintain customer loyalty need a strong digital presence. To that end, enterprises around the globe are replacing outdated systems with more modern solutions.
In fact, the International Data Corp. (IDC) expects global spending on digital transformation to total $6.8 trillion between 2020 and 2023. And as that trend plays out, some of today's start-ups will become tomorrow's industry leaders, meaning investors have a chance to realize big gains in the years ahead.
With that in mind, PagerDuty (NYSE: PD) should be on your watchlist. This company plays a critical role in digital operations management, and if it executes on its opportunity, this stock could grow tenfold over the next 10 years. Here's why.
Image source: Getty Images.
Digital operations management
As the world has become more digital, traditional incident response solutions have become less effective. In many cases, IT issues like website outages and system failures are still identified, triaged, and remediated manually, meaning those issues often last hours or even days. And the fallout from these situations can be quite costly in terms of customer dissatisfaction and lost revenue.
To address this problem, PagerDuty pioneered digital operations management for the modern enterprise. Its platform sits at the core of an organization's digital ecosystem, collecting data from hundreds of software-enabled systems. This includes IT software like Atlassian, application monitoring tools like Datadog, and security platforms like Okta, as well as numerous other technologies.
Using this data, PagerDuty leans on artificial intelligence to predict and automatically prevent downtime of business-critical systems. In certain circumstances, the entire process can be automated. However, when that's not an option, PagerDuty orchestrates a human response by provisioning the appropriate teams (e.g. IT, DevOps, customer service) with contextual information, helping them react in real time.
In short, PagerDuty replaces legacy solutions (which tend to be manual and reactive in nature) with a platform designed to proactively prevent problems, helping clients keep their digital ecosystems in working order. To that end, management puts its market opportunity at $36 billion.
Solid competitive position
As a pioneer in digital operations management, PagerDuty has a first-mover's advantage. The benefits here are twofold: First, the company has built out an extensive ecosystem of over 600 integrations, allowing its platform to collect data from virtually any software-enabled system or device. The breadth of its platform enables use cases that aren't possible with competing solutions.
Second, PagerDuty has nearly 12 years' worth of data. This includes both machine-generated signals that might predict a system outage, and human response data relating to the speed at which incidents are resolved. This vast repository of signals makes PagerDuty's artificial intelligence models more effective in automating the remediation process and mobilizing the appropriate team members.
Collectively, this value proposition has helped PagerDuty win big customers like Cisco, Lululemon, and Netflix. In fact, it currently serves 65% of the Fortune 100, and 45% of the Fortune 500. As of the most recent quarter, PagerDuty has 501 customers that generate over $100,000 in annual recurring revenue (ARR), up 36% from the prior year.
Not surprisingly, the company has posted strong top-line growth.
METRIC
Q2 2020 (TTM)
Q2 2022 (TTM)
CAGR
Revenue
$142.7 million
$244.2 million
31%
Data source: YCharts. TTM = trailing-12-months. CAGR = compound annual growth rate. Note: Q2 2022 ended July 31, 2021.
As a caveat, my biggest reservation about PagerDuty is slowing customer growth. During the most recent quarter, the company grew its customer base by just 6%. Investors need to monitor this metric closely in the coming quarters. However, PagerDuty's net retention rate hit 126% in the second quarter of fiscal 2022, meaning the average customer spent 26% more over the past year. That's a good sign for shareholders, as it underscores the stickiness of the PagerDuty platform.
Moreover, management is executing on a strong growth strategy that should bring more customers to the platform. Specifically, PagerDuty is pursuing clients in the federal vertical and international markets, both of which represent significant opportunities for future growth. The company is also building out its partner ecosystem, which currently represents less than 10% of new ARR each year, though management believes that figure will exceed 25% in time.
Worth the risk
As more companies implement new digital technologies, ensuring that business-critical systems remain up and running will become increasingly difficult. Case in point: The number of critical incidents rose 19% last year, and the average company experienced 105 incidents per month, according to a report from PagerDuty. That impetus should drive demand in the coming years.
With that in mind, I think this stock could produce tenfold returns over the next decade. PagerDuty currently has a market cap of $3.4 billion. But if the company can grow its top line at 30% per year, that figure would reach $34 billion by 2031, assuming the stock trades at a reasonable 10 times sales. That's why PagerDuty should be on your watchlist, if it's not already in your portfolio.
10 stocks we like better than PagerDuty
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and PagerDuty wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of September 17, 2021
Trevor Jennewine owns shares of Okta. The Motley Fool owns shares of and recommends Atlassian, Datadog, Lululemon Athletica, Netflix, Okta, and PagerDuty. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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More consumers are shopping online and connecting with brands through the internet, and companies that hope to win and maintain customer loyalty need a strong digital presence. And as that trend plays out, some of today's start-ups will become tomorrow's industry leaders, meaning investors have a chance to realize big gains in the years ahead. In short, PagerDuty replaces legacy solutions (which tend to be manual and reactive in nature) with a platform designed to proactively prevent problems, helping clients keep their digital ecosystems in working order.
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To address this problem, PagerDuty pioneered digital operations management for the modern enterprise. This vast repository of signals makes PagerDuty's artificial intelligence models more effective in automating the remediation process and mobilizing the appropriate team members. The Motley Fool owns shares of and recommends Atlassian, Datadog, Lululemon Athletica, Netflix, Okta, and PagerDuty.
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This company plays a critical role in digital operations management, and if it executes on its opportunity, this stock could grow tenfold over the next 10 years. In short, PagerDuty replaces legacy solutions (which tend to be manual and reactive in nature) with a platform designed to proactively prevent problems, helping clients keep their digital ecosystems in working order. As of the most recent quarter, PagerDuty has 501 customers that generate over $100,000 in annual recurring revenue (ARR), up 36% from the prior year.
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This company plays a critical role in digital operations management, and if it executes on its opportunity, this stock could grow tenfold over the next 10 years. Second, PagerDuty has nearly 12 years' worth of data. As of the most recent quarter, PagerDuty has 501 customers that generate over $100,000 in annual recurring revenue (ARR), up 36% from the prior year.
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714f3238-203c-4d4c-91b2-73d89976de3e
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718820.0
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2021-10-05 00:00:00 UTC
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5 Unstoppable Growth Stocks to Invest $25,000 in Right Now
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DDOG
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https://www.nasdaq.com/articles/5-unstoppable-growth-stocks-to-invest-%2425000-in-right-now-2021-10-05
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nan
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nan
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Many terrific businesses seem unstoppable -- based in part on their past robust growth as well as on their growth prospects. Here are brief introductions to five contenders you might consider for your portfolio. With $25,000, you might park $5,000 in each, but you can choose just one or two, and you can, of course, invest less if you don't have $25,000 burning a hole in your pocket.
1. Datadog
Datadog (NASDAQ: DDOG) offers companies a cloud-based monitoring and security platform. Its stock has been on a tear in its short time on the public markets, more than tripling in value in about two years -- with an average annual growth rate of nearly 90%.
The stock is popping because the company is. In its second quarter, revenue grew 67% year over year to $234 million, while its number of larger customers generating $100,000 or more in annual recurring revenue rose 59%. Datadog has partnerships in place with some rather sizable and prominent tech businesses, too, such as Microsoft and Salesforce.com, and it keeps adding to its offerings, making for a "sticky" environment that many customers won't want to leave.
2. Palo Alto Networks
Palo Alto Networks (NYSE: PANW) is a global leader in cybersecurity, something few individuals or companies would want to be without these days. The company's stock has surged roughly ninefold over the past nine years, averaging an annual return of about 27%. (For some context, the S&P 500 averaged closer to 15% over the same period, which is still far above average.) Palo Alto's future looks bright, too.
In its recent fiscal year-end presentation, the company noted that it more than doubled the number of major product releases between fiscal 2019 and 2021, with 29 of them in 2021. In its impressive fourth quarter, revenue was up 28% year over year and total billings rose 34%. In the fourth quarter conference call, chair and CEO Nikesh Arora noted:
As a company, we've continued to focus on getting more presence in our customers and getting larger deals with them. I'm delighted to say, we had 18 customers sign transactions over $10 million in the quarter. We had our first customer that surpassed $100 million in their booked business during the fiscal year as they standardized for Palo Alto Networks across the entire enterprise. And our Millionaire customers were up to 986 in Q4, approximately up 30% for the third quarter in a row.
3. PayPal Holdings
PayPal Holdings (NASDAQ: PYPL) may need little introduction, but many people don't appreciate what a big business it is -- with a recent market value topping $300 billion. That's partly due to the fact that PayPal is more than just PayPal. It also encompasses other services, such as the popular payment app Venmo. As of its second quarter, it had 403 million active accounts, and 4.7 billion payment transactions, with a total payment volume of $311 billion.
PayPal's stock has soared more than 600% since the summer of 2015, when it was spun off by eBay, representing an average annual growth rate of about 37%. The company does face meaningful competition, such as from the likes of Square, but it's still a fintech leader, with plenty of growth likely ahead. Its customer engagement, for one thing, has been accelerating, with the number of transactions increasing.
Image source: Getty Images.
4. Atlassian
Atlassian (NASDAQ: TEAM) specializes in collaboration and productivity software, and recently boasted more than 200,000 customers. The company's fourth-quarter letter to shareholders bragged: "We generated $560 million in revenue, up 30% year-over-year, and achieved subscription revenue growth of 50% year-over-year. We added over 23,000 net new customers and the pace of cloud migrations continues to build, increasing more than 2x year-over-year."
Shares of Atlassian have been trading on the public market since late 2015, and since then they have surged more than 1,700%, enough to turn a $10,000 investment into more than $180,000. (That's an average annual growth rate of nearly 65%, by the way.) As the company grows via new product development and acquisitions, its future looks rosy.
5. Shopify
Shopify (NASDAQ: SHOP) may not be a household name, but it's well known in the business world, having achieved a market value recently near $170 billion by offering a popular e-commerce platform. In its second quarter, the company posted year-over-year revenue growth of 57%, with its subscriptions solutions revenue surging 70%, in large part thanks to new customers. The company's monthly recurring revenue (investors love to see recurring revenue, as it's generally predictable) rose 67%.
There's a lot of growth going on at Shopify, and it shows when you look at how its stock has performed in recent years: Shopify shares have been well shopped by investors, advancing nearly an eye-popping 8,000% since only mid-2015. That's an average annual growth rate of about 99%, enough to turn a $10,000 investment into more than $800,000.
That's enough to have some investors wondering whether the stock has gotten way ahead of itself. Many, though, especially long-term investors, see plenty of growth ahead -- and possibly a trillion-dollar market value.
There are no guarantees in the stock market, but these growth stocks seem quite promising. If you can imagine them valued much higher in the future, consider buying in. If you're not convinced they're attractively priced right now, perhaps just add them to your watch list or buy into them incrementally over time.
10 stocks we like better than Palo Alto Networks
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*Stock Advisor returns as of September 17, 2021
Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Selena Maranjian owns shares of Atlassian, Datadog, Microsoft, PayPal Holdings, Salesforce.com, and Square. The Motley Fool owns shares of and recommends Atlassian, Datadog, Microsoft, Palo Alto Networks, PayPal Holdings, Salesforce.com, and Square. The Motley Fool recommends eBay and recommends the following options: long January 2022 $75 calls on PayPal Holdings and short October 2021 $70 calls on eBay. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog Datadog (NASDAQ: DDOG) offers companies a cloud-based monitoring and security platform. Datadog has partnerships in place with some rather sizable and prominent tech businesses, too, such as Microsoft and Salesforce.com, and it keeps adding to its offerings, making for a "sticky" environment that many customers won't want to leave. In the fourth quarter conference call, chair and CEO Nikesh Arora noted: As a company, we've continued to focus on getting more presence in our customers and getting larger deals with them.
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Datadog Datadog (NASDAQ: DDOG) offers companies a cloud-based monitoring and security platform. In its second quarter, revenue grew 67% year over year to $234 million, while its number of larger customers generating $100,000 or more in annual recurring revenue rose 59%. Selena Maranjian owns shares of Atlassian, Datadog, Microsoft, PayPal Holdings, Salesforce.com, and Square.
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Datadog Datadog (NASDAQ: DDOG) offers companies a cloud-based monitoring and security platform. Its stock has been on a tear in its short time on the public markets, more than tripling in value in about two years -- with an average annual growth rate of nearly 90%. In its second quarter, revenue grew 67% year over year to $234 million, while its number of larger customers generating $100,000 or more in annual recurring revenue rose 59%.
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Datadog Datadog (NASDAQ: DDOG) offers companies a cloud-based monitoring and security platform. In its second quarter, revenue grew 67% year over year to $234 million, while its number of larger customers generating $100,000 or more in annual recurring revenue rose 59%. In its second quarter, the company posted year-over-year revenue growth of 57%, with its subscriptions solutions revenue surging 70%, in large part thanks to new customers.
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e38f384c-76ba-48e3-891b-7b98514a414c
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718821.0
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2021-09-30 00:00:00 UTC
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Notable Thursday Option Activity: SPWH, CRTX, DDOG
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DDOG
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https://www.nasdaq.com/articles/notable-thursday-option-activity%3A-spwh-crtx-ddog-2021-09-30
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nan
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nan
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Sportsman's Warehouse Holdings Inc (Symbol: SPWH), where a total of 4,021 contracts have traded so far, representing approximately 402,100 underlying shares. That amounts to about 67.8% of SPWH's average daily trading volume over the past month of 593,385 shares. Particularly high volume was seen for the $15 strike put option expiring October 15, 2021, with 2,005 contracts trading so far today, representing approximately 200,500 underlying shares of SPWH. Below is a chart showing SPWH's trailing twelve month trading history, with the $15 strike highlighted in orange:
Cortexyme Inc (Symbol: CRTX) saw options trading volume of 1,519 contracts, representing approximately 151,900 underlying shares or approximately 66.7% of CRTX's average daily trading volume over the past month, of 227,575 shares. Especially high volume was seen for the $15 strike put option expiring November 19, 2021, with 324 contracts trading so far today, representing approximately 32,400 underlying shares of CRTX. Below is a chart showing CRTX's trailing twelve month trading history, with the $15 strike highlighted in orange:
And Datadog Inc (Symbol: DDOG) saw options trading volume of 18,027 contracts, representing approximately 1.8 million underlying shares or approximately 66.5% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Particularly high volume was seen for the $145 strike call option expiring October 15, 2021, with 2,304 contracts trading so far today, representing approximately 230,400 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange:
For the various different available expirations for SPWH options, CRTX options, or DDOG options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $145 strike call option expiring October 15, 2021, with 2,304 contracts trading so far today, representing approximately 230,400 underlying shares of DDOG. Below is a chart showing CRTX's trailing twelve month trading history, with the $15 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) saw options trading volume of 18,027 contracts, representing approximately 1.8 million underlying shares or approximately 66.5% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange: For the various different available expirations for SPWH options, CRTX options, or DDOG options, visit StockOptionsChannel.com.
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Below is a chart showing CRTX's trailing twelve month trading history, with the $15 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) saw options trading volume of 18,027 contracts, representing approximately 1.8 million underlying shares or approximately 66.5% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Particularly high volume was seen for the $145 strike call option expiring October 15, 2021, with 2,304 contracts trading so far today, representing approximately 230,400 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange: For the various different available expirations for SPWH options, CRTX options, or DDOG options, visit StockOptionsChannel.com.
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Below is a chart showing CRTX's trailing twelve month trading history, with the $15 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) saw options trading volume of 18,027 contracts, representing approximately 1.8 million underlying shares or approximately 66.5% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Particularly high volume was seen for the $145 strike call option expiring October 15, 2021, with 2,304 contracts trading so far today, representing approximately 230,400 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange: For the various different available expirations for SPWH options, CRTX options, or DDOG options, visit StockOptionsChannel.com.
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Below is a chart showing CRTX's trailing twelve month trading history, with the $15 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) saw options trading volume of 18,027 contracts, representing approximately 1.8 million underlying shares or approximately 66.5% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Particularly high volume was seen for the $145 strike call option expiring October 15, 2021, with 2,304 contracts trading so far today, representing approximately 230,400 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $145 strike highlighted in orange: For the various different available expirations for SPWH options, CRTX options, or DDOG options, visit StockOptionsChannel.com.
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b3e9b1ea-b5c7-4d4c-8293-fd2f6f602b23
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718822.0
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2021-09-27 00:00:00 UTC
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Why Growth Stocks Datadog, MongoDB, and Okta Fell Today
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DDOG
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https://www.nasdaq.com/articles/why-growth-stocks-datadog-mongodb-and-okta-fell-today-2021-09-27
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nan
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nan
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What happened
Many growth stocks, particularly in the tech sector, didn't grow their share prices on Monday. For instance, three notable up-and-coming tech companies -- Datadog (NASDAQ: DDOG), MongoDB (NASDAQ: MDB), and Okta (NASDAQ: OKTA) -- all fell much harder on the day than the S&P 500 index. Their declines were related to developments in the bond market.
So what
None of the three had significant price-moving news of their own to report, so it's apparent that their falls (with Datadog off 3.6%, Okta down 4.7%, and MongoDB 4.9% lower) had more to do with those developments.
Specifically, yields on Treasury bonds are rising, after the Federal Reserve intimated that it will bring its asset purchasing program to a halt before long. The yield of the 10-year Treasury on Monday promptly reached its highest level since June, at over 1.5%.
Image source: Getty Images.
Higher bond yields can negatively affect the prices of high-flying tech stocks; Datadog and MongoDB certainly qualify, while Okta hasn't been an outperformer lately but is currently trading 14 times higher than the price set for its 2017 initial public offering.
There are numerous reasons some investors bail from such stocks when benchmark bond yields rise notably. They might be concerned that such share price growth is unsustainable and perhaps due for a significant correction, and thus are withdrawing their money in a flight to lower-risk investments.
Rising Treasury yields could also mean higher borrowing costs if they are sustained. And higher borrowing costs mean a tighter market for capital in general. Since young tech companies such as Datadog, MongoDB, and Okta frequently burn through cash and are often in need of dosh as a result, they could struggle in such an environment.
Now what
It probably isn't time to push the panic button on Datadog, MongoDB or Okta quite yet. Yes, all three collectively post bottom-line losses far more often than profits, but they have compelling business models and are still sitting in front of big growth opportunities. That said, investors should keep an eye on macroeconomic developments and how they might impact each of the trio.
10 stocks we like better than Datadog
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They just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of September 17, 2021
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Datadog, MongoDB, and Okta. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For instance, three notable up-and-coming tech companies -- Datadog (NASDAQ: DDOG), MongoDB (NASDAQ: MDB), and Okta (NASDAQ: OKTA) -- all fell much harder on the day than the S&P 500 index. Specifically, yields on Treasury bonds are rising, after the Federal Reserve intimated that it will bring its asset purchasing program to a halt before long. They might be concerned that such share price growth is unsustainable and perhaps due for a significant correction, and thus are withdrawing their money in a flight to lower-risk investments.
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For instance, three notable up-and-coming tech companies -- Datadog (NASDAQ: DDOG), MongoDB (NASDAQ: MDB), and Okta (NASDAQ: OKTA) -- all fell much harder on the day than the S&P 500 index. Higher bond yields can negatively affect the prices of high-flying tech stocks; Datadog and MongoDB certainly qualify, while Okta hasn't been an outperformer lately but is currently trading 14 times higher than the price set for its 2017 initial public offering. Rising Treasury yields could also mean higher borrowing costs if they are sustained.
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For instance, three notable up-and-coming tech companies -- Datadog (NASDAQ: DDOG), MongoDB (NASDAQ: MDB), and Okta (NASDAQ: OKTA) -- all fell much harder on the day than the S&P 500 index. Higher bond yields can negatively affect the prices of high-flying tech stocks; Datadog and MongoDB certainly qualify, while Okta hasn't been an outperformer lately but is currently trading 14 times higher than the price set for its 2017 initial public offering. See the 10 stocks *Stock Advisor returns as of September 17, 2021 Eric Volkman has no position in any of the stocks mentioned.
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For instance, three notable up-and-coming tech companies -- Datadog (NASDAQ: DDOG), MongoDB (NASDAQ: MDB), and Okta (NASDAQ: OKTA) -- all fell much harder on the day than the S&P 500 index. What happened Many growth stocks, particularly in the tech sector, didn't grow their share prices on Monday. Rising Treasury yields could also mean higher borrowing costs if they are sustained.
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1633f889-60b9-4573-81f7-7b9be83f65df
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718823.0
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2021-09-26 00:00:00 UTC
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3 Top Growth Stocks That Still Look Unstoppable
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DDOG
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https://www.nasdaq.com/articles/3-top-growth-stocks-that-still-look-unstoppable-2021-09-26
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nan
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nan
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It might seem counterintuitive, but when looking for great companies to add to your portfolio, seek out stocks that have already had a solid price appreciation. Winning sports teams tend to keep on winning, and companies are no different. With that in mind, we asked three Motley Fool contributors to highlight one stock that's already a tremendous run so far this year that they'd buy today.
They came up with Global-E Online (NASDAQ: GLBE), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Datadog (NASDAQ: DDOG).
Image source: Getty Images.
Global-E Online: Making global e-commerce sales easier
Danny Vena (Global-E Online): There's little doubt e-commerce has a long runway ahead. Online spending surged in the U.S. last year, growing to 19.6% of total retail sales, up 32% year over year. While growth has slowed in 2021, the trajectory is clear.
One of the headwinds for merchants, however, is dealing with the complexities of cross-border sales. Having the seller in one country and the buyer in another raises a whole litany of issues that most merchants don't have the time or the bandwidth to deal with. That's where Global-E Online comes in. The company handles many of the challenges and complexities that come with international selling, leaving the merchant to go about their daily routine.
The list of complications tied to cross-border sales is extensive: foreign language translation, inter-country regulatory compliance, currency exchange, customs and duties, and even preferences in local payment methods. Global-E Online makes quick work of many of the hurdles associated with international transactions.
The proof is in the pudding. For the second quarter, Global-E delivered revenue that grew 92% year over year, while its gross merchandise volume soared 95%. Gross margin expanded to 36%, up from 32.4% in the prior-year quarter. Excluding the amortization expense related to the warrants held by Shopify, Global-E swung from a loss to a profit, albeit a modest one.
As a result of its robust performance, Global-E raised its full-year guidance. The company now expects 2021 revenue of $1.36 billion at the midpoint of its guidance, up tenfold from revenue of $136 million in 2020.
Investors clearly see the opportunity and have driven Global-E Online stock up by more than 180% since its initial public offering in May.
If you're still not convinced, don't take my word for it. Prior to the IPO, the company announced that e-commerce platform provider Shopify purchased 7.75 million shares of Global-E Online stock, amounting to a 6.5% stake in the company. Shopify took it a step further, acquiring warrants that gave the company the right to buy an additional 11.85 million shares of stock over the ensuing 24 months.
The pair also entered into a partnership agreement that made Global-E Online the exclusive provider of cross-border services for Shopify merchants. The initial term of the agreement extends to April 2024, giving the company plenty of time to make its case to both merchants and investors.
Global-E Online has established itself as the premier provider of end-to-end cross-border services, as evidenced by the keen interest shown by Shopify. Global-E cited research by Forrester that suggests that the cross-border e-commerce market could top $736 billion by 2023. That the company's GMV reached just $774 million last year helps illustrate the magnitude of its opportunity.
Having the world's largest e-commerce platform provider as a mentor won't hurt either.
Image source: Getty Images.
Alphabet knows the ABCs of driving growth
Will Healy (Alphabet): Google parent Alphabet may have attained a $1.9 trillion market cap, but that does not mean it has become too large to produce massive growth. Alphabet has become best known for its dominant search engine, video site YouTube, and the Android operating system. Moreover, Google Cloud's 8% market share in cloud infrastructure spending lags only Amazon Web Services and Microsoft's Azure, according to Canalys.
The aforementioned apps and the Google Cloud drive more than 99% of its current revenue. However, after seeing that, one might forget that Alphabet also owns multiple subsidiaries that could add to growth levels.
Biotech company Calico, AI-focused DeepMind, and Verily Life Sciences are among these companies. Nonetheless, autonomous driving technology company Waymo has appeared to draw more attention, likely for its valuation. Financial data company Pitchbook valued Waymo at $31 billion in 2020. That would give Waymo a value equivalent to around 1.7% of Alphabet's market cap. Since Google drives almost all of Alphabet's revenue, it implies that Waymo and possibly other subsidiaries have locked up significant value. And since self-driving cars are here already, Waymo could boost revenue growth sooner rather than later.
As conditions stand now, revenue growth does not look like a concern. In the first half of 2021, Alphabet reported revenue of $117 billion, 47% more than in the same period in 2020. During that time, net income rose 164% to $36 billion. This increase occurred as its costs increased by only 25%. Also, an additional $7.6 billion in income from gains on equity securities more than covered the $6.8 billion in income taxes, an expense that more than tripled compared with the first six months of 2020.
Given this surge, one can understand why the stock has risen by 60% so far in 2021. Also, thanks to increasing profits, its P/E ratio of 30 has not changed significantly during that time. Even though Alphabet did not offer forward guidance, the multiple appears cheap considering the triple-digit income growth. And between its existing Google businesses and the prospects for its subsidiaries, the long-term gains are not likely to stop anytime soon.
Image source: Getty Images.
Datadog: Chasing the clouds
Brian Withers (Datadog): With its stock up over 50% so far this year, Datadog is a growth investor favorite. But its run is nowhere near done as this cloud-based observability platform is executing at a high level and investing in future growth. Let's take a look at why you'll want to bring this young pup home with you to own for the long term.
It's hard to ignore the stellar growth numbers the company is posting. Not only is the top line growing at breakneck speed, but the company is also winning large customers hand over fist. But probably what's most exciting to investors is the remaining performance obligations that represent the value of all open contracts. RPO has grown at triple digits year over year to a massive $583 million. That means customers are signing larger and longer contracts.
METRIC
Q2 2020
Q1 2021
Q2 2021
CHANGE (QOQ)
CHANGE (YOY)
Revenue
$140 million
$199 million
$234 million
18%
67%
>$100K ARR customers
1,015
1,437
1,610
12%
59%
Remaining performance obligations
$244 million
$464 million
$583 million
26%
139%
Data source: Datadog. QOQ = quarter over quarter. YOY = year over year. ARR = annural recurring revenue.
But the secret of Datadog's success is its sticky ecosystem. Seventy-five percent of customers are using two or more modules, but 28% are using four or more, up from 15% from the last Q2. Today with 16,400 customers and the top 1,610 making up 80% of its annual recurring revenue, the company has plenty of opportunity to expand with the customers it already has.
Lastly, the company is not resting on its past success. Two new products were released in the quarter, Cloud Security Posture Management and Cloud Workload Security, bringing the total number of tools in the Datadog suite to 11. As the company continues to invest in its platform, it makes it more attractive to customers to expand their footprint with this observability leader.
The stock looks expensive at a price-to-sales ratio of 59, but if you are interested in a long-term play on the cloud, this dog could do the trick for you. This young company still has plenty of growth ahead before it becomes full-grown, and you might want to consider making a nice warm place for this puppy in your portfolio.
10 stocks we like better than Global-e Online Ltd.
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Global-e Online Ltd. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of September 17, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Brian Withers owns shares of Datadog and Shopify. Danny Vena owns shares of Alphabet (A shares), Amazon, Datadog, Global-e Online Ltd., Microsoft, and Shopify and has the following options: long January 2023 $1,140 calls on Shopify and long January 2023 $1,160 calls on Shopify. Will Healy has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Datadog, Microsoft, and Shopify. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $1,140 calls on Shopify, short January 2022 $1,940 calls on Amazon, and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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They came up with Global-E Online (NASDAQ: GLBE), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Datadog (NASDAQ: DDOG). The list of complications tied to cross-border sales is extensive: foreign language translation, inter-country regulatory compliance, currency exchange, customs and duties, and even preferences in local payment methods. Shopify took it a step further, acquiring warrants that gave the company the right to buy an additional 11.85 million shares of stock over the ensuing 24 months.
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They came up with Global-E Online (NASDAQ: GLBE), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Datadog (NASDAQ: DDOG). Revenue $140 million $199 million $234 million 18% 67% >$100K ARR customers 1,015 1,437 1,610 12% 59% Remaining performance obligations $244 million $464 million $583 million 26% 139% Data source: Datadog. Danny Vena owns shares of Alphabet (A shares), Amazon, Datadog, Global-e Online Ltd., Microsoft, and Shopify and has the following options: long January 2023 $1,140 calls on Shopify and long January 2023 $1,160 calls on Shopify.
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They came up with Global-E Online (NASDAQ: GLBE), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Datadog (NASDAQ: DDOG). Prior to the IPO, the company announced that e-commerce platform provider Shopify purchased 7.75 million shares of Global-E Online stock, amounting to a 6.5% stake in the company. Revenue $140 million $199 million $234 million 18% 67% >$100K ARR customers 1,015 1,437 1,610 12% 59% Remaining performance obligations $244 million $464 million $583 million 26% 139% Data source: Datadog.
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They came up with Global-E Online (NASDAQ: GLBE), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Datadog (NASDAQ: DDOG). That's where Global-E Online comes in. Today with 16,400 customers and the top 1,610 making up 80% of its annual recurring revenue, the company has plenty of opportunity to expand with the customers it already has.
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7ccc240c-5281-480d-b30d-636abc6e02f0
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718824.0
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2021-09-22 00:00:00 UTC
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Noteworthy Wednesday Option Activity: WKHS, DDOG, WYNN
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DDOG
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https://www.nasdaq.com/articles/noteworthy-wednesday-option-activity%3A-wkhs-ddog-wynn-2021-09-22
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nan
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nan
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Workhorse Group Inc (Symbol: WKHS), where a total volume of 68,801 contracts has been traded thus far today, a contract volume which is representative of approximately 6.9 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 91.9% of WKHS's average daily trading volume over the past month, of 7.5 million shares. Particularly high volume was seen for the $7 strike put option expiring September 24, 2021, with 5,648 contracts trading so far today, representing approximately 564,800 underlying shares of WKHS. Below is a chart showing WKHS's trailing twelve month trading history, with the $7 strike highlighted in orange:
Datadog Inc (Symbol: DDOG) options are showing a volume of 22,746 contracts thus far today. That number of contracts represents approximately 2.3 million underlying shares, working out to a sizeable 83.3% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Particularly high volume was seen for the $140 strike call option expiring October 15, 2021, with 3,626 contracts trading so far today, representing approximately 362,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $140 strike highlighted in orange:
And Wynn Resorts Ltd (Symbol: WYNN) saw options trading volume of 57,338 contracts, representing approximately 5.7 million underlying shares or approximately 81.1% of WYNN's average daily trading volume over the past month, of 7.1 million shares. Particularly high volume was seen for the $82 strike call option expiring September 24, 2021, with 3,611 contracts trading so far today, representing approximately 361,100 underlying shares of WYNN. Below is a chart showing WYNN's trailing twelve month trading history, with the $82 strike highlighted in orange:
For the various different available expirations for WKHS options, DDOG options, or WYNN options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $140 strike call option expiring October 15, 2021, with 3,626 contracts trading so far today, representing approximately 362,600 underlying shares of DDOG. Below is a chart showing WKHS's trailing twelve month trading history, with the $7 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 22,746 contracts thus far today. That number of contracts represents approximately 2.3 million underlying shares, working out to a sizeable 83.3% of DDOG's average daily trading volume over the past month, of 2.7 million shares.
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Below is a chart showing WKHS's trailing twelve month trading history, with the $7 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 22,746 contracts thus far today. Below is a chart showing DDOG's trailing twelve month trading history, with the $140 strike highlighted in orange: And Wynn Resorts Ltd (Symbol: WYNN) saw options trading volume of 57,338 contracts, representing approximately 5.7 million underlying shares or approximately 81.1% of WYNN's average daily trading volume over the past month, of 7.1 million shares. That number of contracts represents approximately 2.3 million underlying shares, working out to a sizeable 83.3% of DDOG's average daily trading volume over the past month, of 2.7 million shares.
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That number of contracts represents approximately 2.3 million underlying shares, working out to a sizeable 83.3% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $140 strike highlighted in orange: And Wynn Resorts Ltd (Symbol: WYNN) saw options trading volume of 57,338 contracts, representing approximately 5.7 million underlying shares or approximately 81.1% of WYNN's average daily trading volume over the past month, of 7.1 million shares. Below is a chart showing WKHS's trailing twelve month trading history, with the $7 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 22,746 contracts thus far today.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $140 strike highlighted in orange: And Wynn Resorts Ltd (Symbol: WYNN) saw options trading volume of 57,338 contracts, representing approximately 5.7 million underlying shares or approximately 81.1% of WYNN's average daily trading volume over the past month, of 7.1 million shares. Below is a chart showing WYNN's trailing twelve month trading history, with the $82 strike highlighted in orange: For the various different available expirations for WKHS options, DDOG options, or WYNN options, visit StockOptionsChannel.com. Below is a chart showing WKHS's trailing twelve month trading history, with the $7 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 22,746 contracts thus far today.
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01c0104c-d1f4-42c6-84a0-5a70e1fa0cfb
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718825.0
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2021-09-21 00:00:00 UTC
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Shareholders may not want to ignore the US$15m worth sales made by Datadog, Inc. (NASDAQ:DDOG) insiders this past year
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DDOG
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https://www.nasdaq.com/articles/shareholders-may-not-want-to-ignore-the-us%2415m-worth-sales-made-by-datadog-inc.-nasdaq
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nan
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nan
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Despite a 5.2% gain in Datadog, Inc.'s (NASDAQ:DDOG) stock price this week, shareholders shouldn't let up. Even though stock prices were relatively low, insiders elected to sell US$15m worth of stock in the last year, which could indicate some expected downturn.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Datadog
In the last twelve months, the biggest single sale by an insider was when the Lead Independent Director, Dev Ittycheria, sold US$12m worth of shares at a price of US$96.02 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$142. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 9.1% of Dev Ittycheria's stake.
In the last year Datadog insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
NasdaqGS:DDOG Insider Trading Volume September 21st 2021
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Datadog Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Datadog shares. In total, insiders sold US$1.5m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Does Datadog Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Datadog insiders own 22% of the company, currently worth about US$9.8b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About Datadog Insiders?
Insiders sold Datadog shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Datadog. When we did our research, we found 5 warning signs for Datadog (1 makes us a bit uncomfortable!) that we believe deserve your full attention.
But note: Datadog may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Despite a 5.2% gain in Datadog, Inc.'s (NASDAQ:DDOG) stock price this week, shareholders shouldn't let up. NasdaqGS:DDOG Insider Trading Volume September 21st 2021 For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price.
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Despite a 5.2% gain in Datadog, Inc.'s (NASDAQ:DDOG) stock price this week, shareholders shouldn't let up. NasdaqGS:DDOG Insider Trading Volume September 21st 2021 For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket. In the last year Datadog insiders didn't buy any company stock.
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Despite a 5.2% gain in Datadog, Inc.'s (NASDAQ:DDOG) stock price this week, shareholders shouldn't let up. NasdaqGS:DDOG Insider Trading Volume September 21st 2021 For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket. Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
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Despite a 5.2% gain in Datadog, Inc.'s (NASDAQ:DDOG) stock price this week, shareholders shouldn't let up. NasdaqGS:DDOG Insider Trading Volume September 21st 2021 For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket. Datadog insiders own 22% of the company, currently worth about US$9.8b based on the recent share price.
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914ad237-c832-4847-9b14-e0f44f52e2ec
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718826.0
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2021-09-16 00:00:00 UTC
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Have $3,000? 3 Unbelievable Growth Stocks You Can Buy on Sale
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DDOG
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https://www.nasdaq.com/articles/have-%243000-3-unbelievable-growth-stocks-you-can-buy-on-sale-2021-09-16
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nan
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nan
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Another major surge in new U.S. COVID-19 cases, supply chain disruptions, and the return of inflation have combined to put something of a damper on the stock market in the first half of September. But this could prove to be an opportunity for long-term retail investors to get their hands on fundamentally strong growth stocks that have recently started trading at a discount.
If you have some excess funds available that you won't require anytime soon for paying bills or covering contingencies, investing that money for the long term in Micron Technology (NASDAQ: MU), Splunk (NASDAQ: SPLK), and DigitalOcean (NYSE: DOCN) could prove to be a winning strategy.
Image Source: Getty Images
1. Micron Technology
Leading memory storage specialist Micron Technology's shares have declined by nearly 25% from their April high due to fears that it will face significant pricing headwinds in the PC dynamic random access memory (DRAM) market and an anticipated decline in PC shipments in the fourth quarter. Several Wall Street analysts believe that memory supply will outpace demand in the coming months. Despite these concerns, the sell-off seems quite exaggerated for the world's third-largest DRAM chip manufacturer and its fifth-largest NAND chip manufacturer.
The tailwinds for the DRAM market are still strong. The work-from-home and remote-learning trends are far from over, especially with the delta-powered wave of COVID-19 cases surging worldwide. Market intelligence firm IDC now expects global PC shipments to grow 14.2% year over year to 347 million units in 2021. In addition, 5G smartphones require more DRAM and NAND memory per device than 4G smartphones, so the ongoing 5G upgrade cycle will add more momentum to demand. There is also a huge spike in server DRAM demand from data centers, driven by the increasing adoption of cloud computing, artificial intelligence, and Internet of Things-based technologies. Electric vehicles also demand more memory and storage to support both in-vehicle infotainment and assisted-driving functions. These will all be key growth drivers for Micron, considering that DRAM chips accounted for 73% of its third-quarter revenues.
Micron currently uses the design and power-efficient 1-alpha node process technology to manufacture DRAM chips. It plans to introduce even more cost-efficient extreme ultraviolet lithography (EUV) technology by 2024. The chipmaker generated $10.86 billion in cash flow from operations in the 12-month period that ended June 3, so Micron is well-positioned to aggressively invest in innovation for further margin expansion.
MU PS Ratio (Forward 1y) data by YCharts
Despite the solid fundamentals, Micron technology is trading at a forward price-to-sales (P/S) ratio around 2, significantly lower than its valuation in April. Against the backdrop of solid secular tailwinds and low valuation, Micron Technology could prove to be an attractive pick for retail investors.
2. Splunk
Data analytics and observability company Splunk's share price has lost a lot of ground in the past year or so. It came back into the public eye in June after it sold $1 billion in convertible senior bonds to well-regarded private equity firm Silver Lake.
Although it was late to embrace the cloud business model, Splunk's transition from a perpetual-license model to a subscription-based model has significantly improved its revenue visibility. Annual recurring revenue (ARR) was up 37% year over year to $2.63 billion as of the end of the second quarter. Cloud ARR, which accounted for almost one-third of total ARR, grew by 72% year over year to $976 million. The company also reported a dollar-based net retention rate of 129% for its cloud business, which implies that on average, Splunk's customers are spending 29% more with it than they spent in the previous year. The adoption of workload-based or usage-based pricing is allowing it to grow with its customers as well as attract new, cost-conscious clients. The company is also gaining momentum in international markets, which accounted for almost 31% of its total revenues in the second quarter.
Splunk is seeing significant improvement across all its key metrics. In the second quarter, revenues were up 23% year over year to $606 million. With contract durations reverting to their pre-pandemic levels, the company is also witnessing a recovery in remaining performance obligation (RPO) bookings. A metric used to indicate the pace of bookings in the coming months, RPO was up 29% year over year to $676 million. Although the company reported negative free cash flow in the second quarter, Splunk is now guiding for $100 million operating cash flow for 2022.
The big data market globally is forecast to grow from $130.7 billion in 2020 to $234.6 billion in 2026. Already servicing big clients like Amazon's AWS, Alphabet's Google Cloud, and Microsoft's Azure, Splunk is well-positioned to leverage this opportunity.
SPLK PS Ratio (Forward 1y) data by YCharts
Splunk currently trades at a discount to key peers such as Dynatrace, Datadog, and Elastic in the observability and analytics market. Given its secular tailwinds, improving financials, and reasonable valuation, this seems to be a good time to invest in Splunk.
3. DigitalOcean
Since its IPO in late March, cloud infrastructure player DigitalOcean's shares have gained more than 60% -- and the run may not be over yet.
In a world where cloud service providers such as AWS, Azure, and Google Cloud are focused on large enterprises, DigitalOcean has differentiated itself by targeting under-served small and medium-sized business (SMB) customers and independent developers. The company estimates that the addressable market in the niche was $44.4 billion in 2020, and that's expected to grow to $115.5 billion in 2024.
The appeal of DigitalOcean lies in the simplicity of its offerings, their affordability, and the company's price transparency -- characteristics that are highly valued in the resource-limited SMB market. Unlike large enterprises, SMBs generally do not have access to independent developer resources. Recognizing this challenge, DigitalOcean has developed detailed tutorials for using its product offerings. The company also has a strong community built around its offerings, where developers interact with SMB customers and guide them on different aspects of hosting cloud applications.
The success of DigitalOcean's strategy can be seen clearly in the significant improvements in its recent financial metrics. In the second quarter, revenues were up 35% year over year to $103.8 million. Its customer base expanded by 9% to 602,000, while its dollar-based net retention rate rose from 102% to 113%. And despite spending relatively less -- only 11% of total revenues -- on sales and marketing, it has achieved solid successes in customer acquisition.
DigitalOcean is still unprofitable, which is not unusual for a young tech company. Considering the solid runway for growth ahead of it, patient investors stand to benefit significantly from holding this stock for the long term.
10 stocks we like better than Digitalocean Holdings, Inc.
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*Stock Advisor returns as of August 9, 2021
Manali Bhade has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Datadog, Digitalocean Holdings, Inc., Elastic, Microsoft, and Splunk. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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There is also a huge spike in server DRAM demand from data centers, driven by the increasing adoption of cloud computing, artificial intelligence, and Internet of Things-based technologies. The chipmaker generated $10.86 billion in cash flow from operations in the 12-month period that ended June 3, so Micron is well-positioned to aggressively invest in innovation for further margin expansion. SPLK PS Ratio (Forward 1y) data by YCharts Splunk currently trades at a discount to key peers such as Dynatrace, Datadog, and Elastic in the observability and analytics market.
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MU PS Ratio (Forward 1y) data by YCharts Despite the solid fundamentals, Micron technology is trading at a forward price-to-sales (P/S) ratio around 2, significantly lower than its valuation in April. Already servicing big clients like Amazon's AWS, Alphabet's Google Cloud, and Microsoft's Azure, Splunk is well-positioned to leverage this opportunity. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Datadog, Digitalocean Holdings, Inc., Elastic, Microsoft, and Splunk.
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If you have some excess funds available that you won't require anytime soon for paying bills or covering contingencies, investing that money for the long term in Micron Technology (NASDAQ: MU), Splunk (NASDAQ: SPLK), and DigitalOcean (NYSE: DOCN) could prove to be a winning strategy. Micron Technology Leading memory storage specialist Micron Technology's shares have declined by nearly 25% from their April high due to fears that it will face significant pricing headwinds in the PC dynamic random access memory (DRAM) market and an anticipated decline in PC shipments in the fourth quarter. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Datadog, Digitalocean Holdings, Inc., Elastic, Microsoft, and Splunk.
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The company also reported a dollar-based net retention rate of 129% for its cloud business, which implies that on average, Splunk's customers are spending 29% more with it than they spent in the previous year. 10 stocks we like better than Digitalocean Holdings, Inc. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Datadog, Digitalocean Holdings, Inc., Elastic, Microsoft, and Splunk.
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9d2da383-eea7-4bf0-91b5-94d3d28b9059
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718827.0
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2021-09-15 00:00:00 UTC
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Sumo Logic Stock Is More Than 50% Off Its All-Time High. Is It a Buy?
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DDOG
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https://www.nasdaq.com/articles/sumo-logic-stock-is-more-than-50-off-its-all-time-high.-is-it-a-buy-2021-09-15
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nan
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nan
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The nearly 10% drop in Sumo Logic's (NASDAQ: SUMO) stock price that followed on the cloud data intelligence's specialist's fiscal second-quarter results placed the stock more than 50% below its February all-time high. Yet, the company is poised to sustain double-digit revenue growth over the long term as it addresses a vast and expanding big data market with its modern cloud-based solutions. So, should investors take this opportunity to invest in this cloud stock?
Cloud and big data
Founded in 2010, Sumo Logic enhanced its initial infrastructure and app monitoring cloud-native platform with additional solutions that leverage artificial intelligence and machine learning to analyze big data and help enterprises get insights into their infrastructures and businesses for better decision making.
And given the shift of enterprises to cloud computing, the market opportunity seems large and growing -- management calculated it at $49.1 billion last year.
Image source: Getty Images.
So with revenue of $58.8 million during the fiscal second quarter (which ended on July 31), up 19% year over year, the company still has plenty of room to grow.
And it seems poised to capture that opportunity -- at least in the short term. Indeed, management anticipates strong double-digit revenue growth to continue with its improved full-year revenue forecast in the range of $236.8 million to $238.8 million in 2022, which corresponds to 17% growth at the midpoint.
Yet, following the 9.49% drop in the stock price after those better-than-expected results, the market values Sumo Logic at a forward enterprise value-to-sales ratio of 7, based on the midpoint of management's full-year guidance. That brings the company's valuation at the low end of the range of its historical forward enterprise value-to-sales ratio.
SUMO EV to Revenues (Forward) data by YCharts
Strong competition
Thus, Sumo Logic's valuation seems to have become attractive. In addition, if you compare with competitors, the valuation discount looks even more impressive. For example, data specialists Elastic (NYSE: ESTC), Splunk (NASDAQ: SPLK), and Datadog (NASDAQ: DDOG) are trading at much higher enterprise value-to-sales ratios of 10, 17, and 44, respectively.
Of course, the higher revenue growth rates these competitors have been enjoying despite their larger scale contribute, at least partially, to such higher valuation ratios.
COMPANY LATEST FISCAL FULL-YEAR REVENUE LATEST FISCAL QUARTER REVENUE GROWTH (YOY) FISCAL FULL-YEAR REVENUE GROWTH GUIDANCE (MIDPOINT)
Sumo Logic $202.6 million 18% 17%
Elastic $608.5 million 50% 33%
Splunk $2.23 billion 23% 15%
Datadog $603.5 million 67% 56%
Data source: Sumo Logic, Elastic, Splunk, and Datadog filings. Calculations by author. YOY = year over year.
Sumo Logic's lower revenue growth relative to those peers suggests the company is losing market share to them, which leads to increasing its scale disadvantage.
Indeed, because of its much-reduced scale, it can't outspend its larger competitors on research and development efforts, which prevents Sumo Logic from offering the broad portfolio some customers require to consolidate their monitoring, security, and data insight capabilities.
That creates a vicious circle where larger competitors are likely to increase their scale advantage with a more comprehensive portfolio, which allows them to budget higher research and development and sales and marketing expenses to fuel more growth and deepen their competitive advantage.
SUMO Research and Development Expense (Quarterly) data by YCharts
Granted, Sumo Logic is making some progress with new products that catch up with its competitors' existing offerings. For instance, it announced new cybersecurity features and application performance capabilities to enhance its platform and trigger cross-selling opportunities.
It's also gaining industry recognition. The research outfit Gartner recently included Sumo Logic in its magic quadrant for Security Information and Event Management (SIEM) as a visionary in terms of ability to execute and completeness of vision. Yet, you should keep in mind Gartner still gave six of Sumo's competitors even stronger positions as leaders in that magic quadrant.
Verdict: Wait and see
In the end, despite the apparently attractive valuation, Sumo Logic's stock remains too risky for my taste. The company is poised to sustain long-term double-digit revenue growth with its modern cloud platform in a large and growing market. At the same time, Sumo is struggling to catch up against competitors that manage to grow faster despite their much larger scale.
In addition, Sumo Logic's valuation still corresponds to strong revenue growth expectations that may not materialize given the company's competitive disadvantage. Thus, investors should wait for Sumo Logic to eventually match the growth of its competitors before considering adding it to their list of cloud stocks to buy.
10 stocks we like better than Sumo Logic, Inc.
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They just revealed what they believe are the ten best stocks for investors to buy right now... and Sumo Logic, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of August 9, 2021
Herve Blandin has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For example, data specialists Elastic (NYSE: ESTC), Splunk (NASDAQ: SPLK), and Datadog (NASDAQ: DDOG) are trading at much higher enterprise value-to-sales ratios of 10, 17, and 44, respectively. Yet, following the 9.49% drop in the stock price after those better-than-expected results, the market values Sumo Logic at a forward enterprise value-to-sales ratio of 7, based on the midpoint of management's full-year guidance. Indeed, because of its much-reduced scale, it can't outspend its larger competitors on research and development efforts, which prevents Sumo Logic from offering the broad portfolio some customers require to consolidate their monitoring, security, and data insight capabilities.
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For example, data specialists Elastic (NYSE: ESTC), Splunk (NASDAQ: SPLK), and Datadog (NASDAQ: DDOG) are trading at much higher enterprise value-to-sales ratios of 10, 17, and 44, respectively. SUMO EV to Revenues (Forward) data by YCharts Strong competition Thus, Sumo Logic's valuation seems to have become attractive. Sumo Logic $202.6 million 18% 17% Elastic $608.5 million 50% 33% Splunk $2.23 billion 23% 15% Datadog $603.5 million 67% 56% Data source: Sumo Logic, Elastic, Splunk, and Datadog filings.
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For example, data specialists Elastic (NYSE: ESTC), Splunk (NASDAQ: SPLK), and Datadog (NASDAQ: DDOG) are trading at much higher enterprise value-to-sales ratios of 10, 17, and 44, respectively. The nearly 10% drop in Sumo Logic's (NASDAQ: SUMO) stock price that followed on the cloud data intelligence's specialist's fiscal second-quarter results placed the stock more than 50% below its February all-time high. SUMO EV to Revenues (Forward) data by YCharts Strong competition Thus, Sumo Logic's valuation seems to have become attractive.
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For example, data specialists Elastic (NYSE: ESTC), Splunk (NASDAQ: SPLK), and Datadog (NASDAQ: DDOG) are trading at much higher enterprise value-to-sales ratios of 10, 17, and 44, respectively. And given the shift of enterprises to cloud computing, the market opportunity seems large and growing -- management calculated it at $49.1 billion last year. 10 stocks we like better than Sumo Logic, Inc.
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0e4c856e-db7f-4cc5-afdf-c944bf9cccb8
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718828.0
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2021-09-12 00:00:00 UTC
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What Investors Need to Know About Elastic's Q1 Earnings
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DDOG
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https://www.nasdaq.com/articles/what-investors-need-to-know-about-elastics-q1-earnings-2021-09-13
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nan
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nan
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Elastic (NYSE: ESTC) is a search company, but not in the traditional sense. Its software platform brings search functionality to a wide range of business use cases, allowing clients to ingest and analyze data. For instance, Elastic makes it possible to sift through corporate resources to find a particular document or file. The platform also logs billions of events each day, which helps IT and security teams troubleshoot application performance issues and remediate cyberattacks.
In this Backstage Pass video, which aired on Aug. 26, 2021, Motley Fool contributors Trevor Jennewine and Brian Withers discuss Elastic's Q1 earnings.
10 stocks we like better than Elastic
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Elastic wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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Trevor Jennewine: Elastic is a search company, not in the Google-type way. But they provide search tools too. You can think of it as an internal workplace search engine. Their platform allows you to log an index data, and then go back through and search the data, analyze it, visualize it. Search is a tool they put at the center of these various use cases.
Just to give a couple of examples on how it's used, you can use the Elastic search to put a search box in an application or a website. Shopify, the help documentation on the Shopify website is powered by Elastic. MercadoLibre's seller listings are powered by Elastic. When they want to go in and update a price or find all their listings that they have on the platform, that's powered by Elasticsearch.
[And] because their logging and indexing data, that also has applications for observing network performance and application performance or just generalized infrastructure performance. IT teams can use that to identify problems, resolve them, security analyst can do the same to identify threats and then remediate them. But the big thing is Elastic is a search company, and they use that functionality for a lot of different use cases.
I'm going to share my screen one more time here. We're going to look at their most recent results. This first slide, I'm trying to make it a little bit bigger. This is the first quarter of fiscal 2022. Revenue growth came in at 50%. That number was $193 million up 50% from the prior year. But one of the company's growth strategies is to expand usage of Elastic Cloud and this is its software as a service product, and lots of industry, lots of enterprises are shifting resources to the Cloud, and so management thinks is a great opportunity for them to grow this product. That product they actually grew 89% with Elastic Cloud. This product is growing faster than the overall business, which is a good sign; it shows that the management has a good feel for their growth strategy and they're executing on it.
One of the things that investors should pay attention to of this company is its ability to grow customers, and its ability to grow its customer base and expand within its customer base, are two more big pillars of management's growth strategy. With that in mind, they reach 16,000 subscription customers during the most recent quarter, and not all of those customers are actually using Elastic Cloud. They generate subscription revenue from onsite deployments too, and onsite deployments represent the majority of the way the customers are consuming Elastic right now. To put the Elastic Cloud number in perspective, revenue from Elastic Cloud was about $62 million in the first quarter. That's about 32% of total revenue. But they are making progress. Last year that number was 27%, and the year before it was 22%, and the year before that it was 17%. They are moving up the curve there.
Then the last thing I'll note is that they are gaining traction with some of these bigger customers. They have 780 customers with an annual contract value of over $100,000 now and that number is up 24% over the prior year. One other thing, at the end of fiscal 2021, the end of the last quarter, they actually had 75 customers that are having an annual contract value of over $1 million, and that was up from 50 [customers in the prior year]. They're adding new customers, but they're also growing with these bigger customers, which is a good sign.
Then down here, management notes that their net expansion rate was slightly below 130 %, and this is the way they phrased it in the previous quarter as well. Coming into 2020, they would note in their SEC filings that their expansion rate was over 130% than it had been for the previous three years. Then last year, it gets below 130% and that's where it stayed during this quarter, but that's still strong expansion. Customers are still spending more each year. The business is gaining traction.
Let's see here. One positive note in terms of profitability, they generated positive free cash flow for the first time last year and they maintain that into the first quarter of this year with $12.4 million of free cash flow. They also have a strong net cash position. They have just under $1 billion dollars in cash and equivalents on their balance sheet and that's compared to about $566 million in debt. So net cash position there.
Let's see. During theearnings call management mentioned that they expect revenue to reach $1 billion dollars, annualized revenue to reach $1 billion dollars by fiscal 2023. That's not this year, but the following year. That's not incredible growth, but it is strong growth over that period. Let's see. Over the trailing-12-months, they've generated somewhere in the $670 million range. Over the next two years, they expect that to jump up to over a billion. They're optimistic about the future prospects of the business. It looks we have a few more seconds here.
One other thing I wanted to throw in real quick is management is going pretty hard at the cybersecurity or the security solutions provided through the Elastic. They did make two acquisitions very recently. They acquired CMD and Build.Security. These play into what they call their limitless extended detection and response platform that they just released. This platform, it unifies security information event management, and it has endpoint protection and now it's pulling Cloud security with these two recent acquisitions in it. Management sees that as a big growth driver. Cybersecurity is a pretty hot topic right now. I like the way they're thinking about that.
Brian Withers: Yeah, Trevor, I noticed as I went through the Elastic presentations and theearnings calland they talk about being a search company. But some of those, as you pointed out, some of the use cases for search company are helping figure out bugs and track down issues in their IT system because their software is basically set up to peer into all of the applications that you have across your enterprise. They seem to be doing a little bit of competing with Datadog as well.
Trevor Jennewine: Right. I think they're very similar. I think Datadog has a more robust solution on the application performance monitoring side of things, but that's exactly right. Elastic, they're very good at logging and indexing this information and then allowing the search through it for various purposes. One final anecdote. There's a site, DB-Engines, that ranks various databases which you can actually go into the workplace search engine and Elastic is the leader by a good margin. Splunk could take second place there. Elastic is the most popular workplace search engine according to DB-Engine.
Brian Withers owns shares of Datadog, MercadoLibre, and Shopify. Trevor Jennewine owns shares of MercadoLibre and Shopify. The Motley Fool owns shares of and recommends Datadog, Elastic, MercadoLibre, Shopify, and Splunk. The Motley Fool recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Its software platform brings search functionality to a wide range of business use cases, allowing clients to ingest and analyze data. In this Backstage Pass video, which aired on Aug. 26, 2021, Motley Fool contributors Trevor Jennewine and Brian Withers discuss Elastic's Q1 earnings. But some of those, as you pointed out, some of the use cases for search company are helping figure out bugs and track down issues in their IT system because their software is basically set up to peer into all of the applications that you have across your enterprise.
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One of the things that investors should pay attention to of this company is its ability to grow customers, and its ability to grow its customer base and expand within its customer base, are two more big pillars of management's growth strategy. During theearnings call management mentioned that they expect revenue to reach $1 billion dollars, annualized revenue to reach $1 billion dollars by fiscal 2023. The Motley Fool owns shares of and recommends Datadog, Elastic, MercadoLibre, Shopify, and Splunk.
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But one of the company's growth strategies is to expand usage of Elastic Cloud and this is its software as a service product, and lots of industry, lots of enterprises are shifting resources to the Cloud, and so management thinks is a great opportunity for them to grow this product. One of the things that investors should pay attention to of this company is its ability to grow customers, and its ability to grow its customer base and expand within its customer base, are two more big pillars of management's growth strategy. To put the Elastic Cloud number in perspective, revenue from Elastic Cloud was about $62 million in the first quarter.
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With that in mind, they reach 16,000 subscription customers during the most recent quarter, and not all of those customers are actually using Elastic Cloud. To put the Elastic Cloud number in perspective, revenue from Elastic Cloud was about $62 million in the first quarter. The Motley Fool owns shares of and recommends Datadog, Elastic, MercadoLibre, Shopify, and Splunk.
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1a9efa5a-b346-4f23-9b23-1f33819eb55f
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718829.0
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2021-09-11 00:00:00 UTC
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Cathie Wood's Latest Picks: 2 Stocks She Just Bought
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DDOG
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https://www.nasdaq.com/articles/cathie-woods-latest-picks%3A-2-stocks-she-just-bought-2021-09-11
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nan
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Fund manager Cathie Wood, the founder and CEO of ARK Invest, has earned a reputation as one of Wall Street's best stock pickers. And that reputation is well deserved. Over the past one, three, and five years, ARK's flagship Innovation ETF has crushed the broader market.
Given that impressive track record, smart investors may want to keep tabs on what Wood is buying and selling. Recently, she added shares of PagerDuty (NYSE: PD) and UiPath (NYSE: PATH) to ARK's flagship ETF. Here's what you should know about these tech stocks.
Image source: Getty Images.
1. PagerDuty
PagerDuty is the central nervous system for the modern enterprise. Its platform sits at the center of a company's digital ecosystem, collecting data from virtually all systems and devices. Then, by blending those signals with artificial intelligence, PagerDuty helps its clients predict and prevent the downtime of critical services and technologies.
For example, the PagerDuty platform captures data from application performance-monitoring tools such as Datadog, IT operations hubs such as ServiceNow, public clouds such as Microsoft Azure, customer service software such as Salesforce.com, and communications platforms such as Zoom. And when issues are identified, PagerDuty either triggers automatic remediation or alerts the appropriate people, helping them quickly resolve incidents such as website outages or system failures.
As a pioneer in this industry, PagerDuty has 12 years' worth of data and more than 14,100 customers, both of which make the company's artificial-intelligence models more effective. And as new clients join the platform, PagerDuty's data repository will continue to grow, further reinforcing this advantage.
Financially, the company has posted solid top-line growth over the past two years. Trailing-12-month revenue has increased from $142.7 million in the second quarter of 2020 to $244.2 million in Q2 of 2022, which ended July 31, with a compound annual growth rate (CAGR) of 31%.
Investors should note that PagerDuty is still not profitable on a GAAP basis, and the company generated negative free cash flow of $6.4 million over the past 12 months. However, PagerDuty is still in the early stages of growing its business, and management believes the company has captured less than 1% of its market opportunity.
Here's the bottom line: In an increasingly digital world, delivering a high-quality customer experience is not an option -- it's a necessity. And PagerDuty capitalizes on that fact, helping clients keep their digital ecosystems up and running at all times. Given Wood's focus on innovative technologies such as artificial intelligence, I'm not surprised to see her adding shares of this tech stock to ARK's portfolio.
2. UiPath
UiPath is on a mission to bring automation to every enterprise. To that end, its platform combines three cutting-edge technologies -- artificial intelligence, low-code development, and robotic process automation -- helping clients build, deploy, and manage software bots capable of automating various processes in place of human employees.
To do this, UiPath's bots rely on several types of artificial intelligence, including computer vision, natural language processing, and machine learning. Together, these technologies infuse the bots with the ability to read and understand language, emulate human behavior, and make decisions. In turn, that allows them to automate both simple and complex tasks, such as reviewing emails, completing forms, and extracting data from documents.
One of UiPath's greatest advantages is its partner ecosystem. The company provides prebuilt integrations with hundreds of popular technologies, including Amazon Web Services, Microsoft 365, and Salesforce, meaning clients can quickly automate workflows on these platforms.
Because of the scope of the company's mission and its value proposition to clients, UiPath has grown its top line at an impressive pace. Its trailing-12-month revenue has grown from $451.2 million in the second quarter of 2021 to $736.9 million in Q2 of 2022, which ended July 31, for a CAGR of 63%.
Like PagerDuty, UiPath is currently unprofitable on a GAAP basis and is free cash flow negative. But the company has established itself as the industry leader, according to Forrester Research, and it makes sense to reinforce that advantage by investing aggressively in growth. That's exactly what management is doing.
Here's the bottom line: Automation drives efficiency and productivity by freeing human employees to spend their time on more important tasks, something that would benefit virtually every enterprise in the world. And UiPath has the best product on the market. That's why I'm not surprised to see Wood doubling down on this tech stock.
10 stocks we like better than PagerDuty
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They just revealed what they believe are the ten best stocks for investors to buy right now... and PagerDuty wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of August 9, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Trevor Jennewine owns shares of Amazon and UiPath. The Motley Fool owns shares of and recommends Amazon, Datadog, Microsoft, PagerDuty, Salesforce.com, ServiceNow, and Zoom Video Communications. The Motley Fool recommends Gartner and UiPath and recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And when issues are identified, PagerDuty either triggers automatic remediation or alerts the appropriate people, helping them quickly resolve incidents such as website outages or system failures. The company provides prebuilt integrations with hundreds of popular technologies, including Amazon Web Services, Microsoft 365, and Salesforce, meaning clients can quickly automate workflows on these platforms. Here's the bottom line: Automation drives efficiency and productivity by freeing human employees to spend their time on more important tasks, something that would benefit virtually every enterprise in the world.
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To that end, its platform combines three cutting-edge technologies -- artificial intelligence, low-code development, and robotic process automation -- helping clients build, deploy, and manage software bots capable of automating various processes in place of human employees. The Motley Fool owns shares of and recommends Amazon, Datadog, Microsoft, PagerDuty, Salesforce.com, ServiceNow, and Zoom Video Communications. The Motley Fool recommends Gartner and UiPath and recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon.
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To that end, its platform combines three cutting-edge technologies -- artificial intelligence, low-code development, and robotic process automation -- helping clients build, deploy, and manage software bots capable of automating various processes in place of human employees. See the 10 stocks *Stock Advisor returns as of August 9, 2021 John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. The Motley Fool owns shares of and recommends Amazon, Datadog, Microsoft, PagerDuty, Salesforce.com, ServiceNow, and Zoom Video Communications.
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UiPath UiPath is on a mission to bring automation to every enterprise. To that end, its platform combines three cutting-edge technologies -- artificial intelligence, low-code development, and robotic process automation -- helping clients build, deploy, and manage software bots capable of automating various processes in place of human employees. See the 10 stocks *Stock Advisor returns as of August 9, 2021 John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors.
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718830.0
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2021-09-10 00:00:00 UTC
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Why Elastic Is Up, Why Fastly Has Hit a Wall, and Can Lemonade Actually Disrupt Insurance?
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DDOG
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https://www.nasdaq.com/articles/why-elastic-is-up-why-fastly-has-hit-a-wall-and-can-lemonade-actually-disrupt-insurance
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nan
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A slow news day means it's time to break out a round of "Yes, No, Maybe So." In this episode of MarketFoolery, host Chris Hill is joined by Jason Moser who shares why he's bullish on Elastic (NYSE: ESTC), why he thinks the thesis has changed for Fastly (NYSE: FSLY), and why he's on the fence about Lemonade (NYSE: LMND). Plus, we dip into the Fool Mailbag to discuss allocation strategies.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.
10 stocks we like better than Lemonade, Inc.
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They just revealed what they believe are the ten best stocks for investors to buy right now... and Lemonade, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of August 9, 2021
This video was recorded on September 7, 2021.
Chris Hill: It's Tuesday, September 7th. Welcome to MarketFoolery. I'm Chris Hill, with me, it's not Monday, but it's the start of the week on MarketFoolery, so it's Jason Moser, thanks for being here.
Jason Moser: Howdy-howdy, how's everything going?
Hill: Going all right. Hope all the dozens of listeners had a good Labor Day weekend. Shanah Tovah to all those celebrating Rosh Hashanah. We're going to talk about allocation strategy. But first, we're going to do something we have not done in a while, longtime listeners will remember this. It's a little thing we like to call yes, no, maybe so. Three stocks, one is a yes, one is a no, and one stock is sitting right there on the fence and we're going to get through all three of them. Let's start with the yes stock -- Elastic, ticker symbol ESTC. This is if I understand it correctly because I know you've mentioned a couple of times Software-as-a-Service, but it's built around search. Elastic is about a $15 billion company in terms of market cap. Why does this look like a yes to you right now?
Moser: Yeah. Well, you know how I feel about Cloudflare. I think I've been pretty clear about that on these shows. I'm starting to feel that way about Elastic too. Remember Elastic develops software and services that enables users to search through structured and unstructured data for all sorts of consumer and enterprise applications. The thing is when you say Elastic is in the business of search, immediately and rightly so your mind should go to a little company called Google. There is this search engine called Google that does pretty darn well in the Search industry. The interesting thing about Elastic, as I mentioned, is the enterprise application app, Elastic's customers are companies, they're businesses. They're focused on helping enterprises utilize data in search in order to make better decisions ultimately. They had a very focused customer base and therefore market opportunity and we've seen efforts from companies including Google, including Alphabet, to try to gain some traction in the space and they really haven't made too much progress. Now, I attribute that partly to the ongoing success of Elastic, but the technology that they've built ultimately is working very well. 93% of their revenue is tied to subscriptions. As their customers get larger so does their relationship with Elastic.
Just to put some context around that, more than 45% of customers with at least $1 million in annual contract value subscribed to all three of Elastic's core solutions. So I think that certainly indicates not only some strong network effects at play there for the business but ultimately that they're doing something well and ultimately that can result in higher switching costs, which can ultimately beget some pricing power as time goes on. We look at the most recent quarter and the key performance indicators all tell a story of a business that's executing. Total subscription customer count was over 16,000. That was versus 15,000 just a quarter ago and 12,100 a year ago. The total customer account with annual contract value of greater than $100,000 was over 780. That was up from 730 a quarter ago and 630 a year ago and better yet that growth is actually accelerating. We're seeing here just a company that is focused on one particular market opportunity. They are executing very well within that market opportunity. Ultimately, you're talking about a market opportunity that all estimates have in the neighborhood of $50 to $75 billion today. Elastic just seems like a business that is poised to continue capturing a lot of that share based on the metrics that we're seeing today. When you look at their customers, these are big customers. These are customers that folks would recognize. You're talking about companies like Adobe and Shopify, a little company called Microsoft, Etsy, Verizon, Netflix. Elastic is serving all of these businesses to help them use their data, sift through that data, and make better decisions. It just strikes me as a business that's going to become only more relevant here as time goes on.
Hill: When we were talking on Motley Fool Money last week and I was asking you and Andy Cross about what's a stock you would have on a short leash, you talked about Bill.com just because of the valuation of Bill.com. Elastic's not profitable. The stocks, close to a high that doesn't put you off, or do you say all the more reason to have a longer time horizon?
Moser: Well, I would say it is definitely all the more reason I have a longer time horizon. I'm glad you mentioned Bill.com because Elastic, yes, it is still unprofitable stock trading somewhere in the neighborhood of 30 times gross profit today and I think when we were looking at Bill.com last week for the show, Bill.com, on the other hand, was like 150 times gross profit. So even there's a discrepancy there that is pretty mind-bending. I certainly would not call Elastic a steal or cheap or anything like that. But as I've said before, I think when you look at companies that are really tackling big problems; issues where demand for that solution is high. I think that parsing data at the enterprise level, the demand for that is very high. You give them a little bit more leeway to do their thing when it comes to the financials and the valuation. I think this is a business that does require a much longer term outlook there, but that really plays right into how we invest anyway. So the valuation doesn't trip me up too much today. I think it's an indicator that the company is executing well, perhaps it's worth buying this one in thirds, as we talk about. Buy a little bit today and then buy a little bit later and then maybe a little bit later. You don't have to buy it all at once. But yeah, I can certainly understand the valuation concerns there, but that certainly seems to be a very widespread problem in today's market too.
Hill: The stock you've got as a no, it does not have the "problem" of being at a high. In fact, I'm sure there are some people who look at Fastly, which is trading within shouting distance of a 52-week low and they think, "Oh, Fastly could be a value play right here." Why is it not only not a value play for you? It's one where you're like, "No, not interested." Because they're in an industry that is a growth industry.
Moser: It is, there's no question maybe we talk about edge networks and content delivery networks. Fastly has been a name that has bubbled up to the surface for many investors for a while. I think ultimately Fastly is a business I was interested in for a while. I was looking at Fastly and Cloudflare and trying to come to the conclusion which one I liked more. Ultimately, as you could guess, I went with Cloudflare. To me, this is a business where the thesis has changed. I think they were looking at a situation here where their technology is proving to not be a competitive advantage, and in this line of work it really has to be. I've always had concerns with their usage-based revenue model. I felt like that was very limiting and when you compare that with a business like Cloudflare, which had adopted not only usage-based but contractual and subscription offerings they were meeting their customers on all fronts. Not to mention they do more things than Fastly does, anyway, it's beyond just an edge network.
But then, one of the real tells for me, just about a year and a half ago, Founder and CEO Artur Bergman, stepped down and that was in the midst of a business that was starting to witness some headwinds. There was the TikTok relationship that dissolved. That was a big contributor to their top-line. When you fast forward to today, growth has hit a wall. They just recorded 14% top-line growth last quarter. For a business like this that's valued the way it is? Again, one of these newfangled tech companies with no real earnings in the market is taking a little bit of a greater leap of faith with some of these. This is one where 14% top-line growth [...] is going to cut it. Part of that is, I think due to the fact that this thesis has changed a little bit, I think they are succumbing to some of the competition out there, businesses like Cloudflare delivering better products and services. But that growth it's playing out on the top and the bottom line there and margins continue to compress.
So ultimately, when I look at Fastly, I want to make sure listeners are understand. I'm not saying that Fastly is going to zero. That's not what I'm saying here. It strikes me as a business. It's a company that's in need of a suitor and it's not totally clear who that would be. We'd heard some rumors a time ago that Cisco might be interested. Perhaps they're just waiting for another shoe to drop to see if they could get a better deal. But to me, it's starting to feel like Fastly is a business that's ultimately it's looking for a suitor, and we've said on this show many times, the acquisition, it's fine if it happens. Sometimes it's a nice bailout. Don't discount the possibility there, but it's not an investing thesis. I wouldn't buy something like a Fastly today based on the idea that it's going to get acquired. They very well may, I think it probably will, but I think that the competition in this space is ramping up such that given the leadership change and ultimately what I think they're going to have to make a pivot in regard to the revenue model. They're going to have to get away from that usage-based model. I think that does hold them back, but when you put all of that stuff together, to me it feels like the thesis has really changed here and investors need to be aware of that.
Hill: You look at the 25-year track record of the acquisitions that Cisco Systems has made and I guess if you're a shareholder, take comfort in the fact that if they end up buying Fastly, they've overpaid far worth for other businesses in the past couple of decades.
Moser: Yes.
Hill: Let's move on to one that, when you and I were talking this morning and you were like, "I'm on the fence on this one." I was like, "Oh, my God, so am I." Which is why I'm really happy and excited to talk to you about Lemonade, ticker LMND, the insurance business similar to Fastly, has got about a $5 billion market cap, Lemonade a little smaller, about $4.7 billion. This is one I literally have written down on a post-it note with a question mark, because a lot of people we work with like this business, are big fans of it both as consumers and as investors. I am right there with you on the fence.
Moser: I got a good chuckle out of that. This morning we were talking because obviously, we did not put our heads together before that meeting. You're right, it is one that a lot of folks here at The Fool like, my partner in crime for the Monday Industry Focus show, Matt Frankel, he's a fan, he's definitely talked about it a number of times on the show, and I understand that. To me, it is truly one which I'm totally on the fence about. I can't really make up my mind. I like the idea and concept. Lemonade is utilizing artificial intelligence, a machine learning method, to ultimately make better decisions. That really is what the insurance business is all about. Making good decisions regarding the business that you write. It is a massive market opportunity. Worldwide, you're looking at insurance as a $5 trillion industry. It's very legacy written. It's just that they've been doing it the way they've been doing it forever. It's like, why do you do it that way? Well, this is just the way we've always done it.
Maybe there is a way to do it better and that seems to be what Lemonade is trying to exploit. But what we've seen certainly throughout our time here on these shows and with our services here at The Fool, insurance is a very hard business. It seems simple in concept, but to run an efficient and effective insurer to where you're pleasing your customers, you're making it happen for investors. Now obviously, so many companies focused on really ultimately making the world a better place and looking out for all stakeholders, which I think is great, those are all things that you have to take into consideration. When you look at the numbers, a year ago in the second quarter of 2020, their customer base was primarily renters. They sold renters insurance. That represented about 75% of the business. Then homeowners accounted for the balance of that. Now they've done, I think, a tremendous job in diversifying away from that renter base. By the end of the first quarter of 2021, that renter's share was down to 56% with homeowners representing 30%. But then they've also introduced pet insurance, they've introduced life insurance. You've got pet representing 13% of business last quarter and they're going to continue to roll out new offerings. Automobiles is going to be another opportunity for them. It sounds like customers, for the most part, like the interface, like the brand. It seems to be fairly frictionless, easy to access mobile, digital, those are great things.
You look at their business model on the other hand, and it makes you wonder at least a little bit. Because ultimately, the way they run their business is that they take 75% of the premiums they collect and then they purchase reinsurance ultimately to handle the insurance. They're a middleman in that regard. The other 25% is set aside to cover operating costs and hopefully generate a profit. They also focus on donating excess funds to charity, great, I think. Now, when I mentioned that 75% number, that to me, I start thinking, OK, well, if their business is ultimately depending on purchasing insurance from other insurers, well then that puts a lot of the power in those other insurers' hands. They can start to dictate a little bit more pricing as they see fit. Now, the flip side of that is that Lemonade is working to change that. They did note in their most recent quarter that they are reducing that portion of premium that they see to those reinsurers. That 75% number is now more like about 70%. I think over time they're ultimately aiming to bring that number down significantly. That could be good assuming they know what they're doing. It seems like they do, but again, insurance is a very hard business. All of that together, it just leaves me with a big question mark. I just don't know. I haven't been able to really fully make up my mind here.
Hill: I don't know about you, but I'd take a little bit of solace in the fact that the market as a whole appears to be right there with us, because you look at the one-year chart of Lemonade, it's been as low as $44, it's been as high as $188 million. There are a lot of people who are trying to make up their minds about this business.
Moser: Well, I think this could be one of those generational plays. Maybe this is a concept that's resonating more with the younger audience. Gen Z-ers and beyond, maybe this is the way insurance starts to work for those younger generations as they come up into the workforce. They start driving, renting, buying homes, or whatnot. That ultimately remains to be seen, but at the end of the day, it really does seem like it boils down to how good their tech is, the AI and the machine learning. Is that ultimately helping them make better decisions? Because if it does, and they are able to wean themselves off of that reinsurance model, that could work out very well for them. We've seen good, well-run insurers do very well over long periods of time, they're wonderful long-term investments. It's just really trying to get a grip on whether these guys have the staying power, the brand equity, and ultimately the technology to be able to disrupt what has obviously been a very difficult industry to disrupt at this point.
Hill: Before we wrap up, our email address is marketfoolery@fool.com. We got an email from Charles, who writes, "New to the show and very new to investing. I'm wondering if it makes sense to invest in two or more companies that provide the same product or service. For example, Volta and ChargePoint? I'm a big fan of MarketFoolery and Motley Fool Money. You all provide a wealth of information. It is much appreciated. Thanks. PS, I must have the man behind the glass as DJ at my next shindig. The music selection on Motley Fool Money is second to none." I can't help but agree. We've gotten so many emails and tweets over the last year about the bumper music that Dan Boyd picks for Motley Fool Money. By the way, Volta, interesting timing on Charles' email. I got a press release sent to me this morning about Volta just striking a deal with Six Flags amusement park.
Moser: Oh, wow.
Hill: Now, Volta is going to be the charging station at Six Flags. I don't know about you. The first thing I thought when I saw Charles' email was the war on cash basket. The second thing I thought was that two of the more recent stocks I just bought are head-to-head competitors, Home Depot and Lowe's.
Moser: Well, the short answer to the question is yes. I like this idea, particularly when the market opportunity seems really, really big, and so you said it. The first thing that came to my mind is the war on cash basket. That's ultimately why we built that thing in the first place. You and I were sitting there talking about MarketFoolery after MarketFoolery, but how well all of these companies and this payments industry were doing. It didn't make sense to really try to pick one winner when it was pretty apparent there are going to be a number of winners. When the market opportunity seems like it's pretty big, that's why I think this strategy works out even better. Then just the same point with your Home Depot and Lowe's example there, but just a massive market opportunity in housing. Now, not speaking particularly to these two businesses, Volta and ChargePoint, I think it was? Because I haven't dug into these businesses, but from what I can gather, they ultimately are building charging stations right there. They're facilitating the electrification of our transportation industry, which is ultimately a very good thing. I think Tesla gets all of the headlines, but we have to recognize the fact that Tesla is not going to own this market 100%. They're going to be one of, I think, a number of companies that help us ultimately make this transition. It seems to me to be an attractive market opportunity.
That's where it may make sense to consider owning a couple or three or four of the businesses that you think are really going to lead the charge, so to speak, no pun intended, sorry about that. Investing is rarely a zero-sum game. We like to make it sound that way when we're talking about these businesses, we're bullish or bearish or we're picking one over another. But the fact of the matter is that investing is rarely a zero-sum game. I too own a number of companies that on the surface, maybe they compete with each other to an extent, but they are really playing an ultimately what is a very large sandbox. To me, that's a very sensible strategy.
Hill: Let me just go back to two companies we talked about earlier in the show, Fastly and Cloudflare. If you went back a year and said cybersecurity, I'm going to buy a basket of stocks and you picked those two along with Datadog and CrowdStrike, that's a basket that as a group is doing very well. Now, Fastly is down about 40%, CrowdStrike has doubled in the past year, Datadog is up 70%, Cloudflare is up nearly 300%. But again, if you take the basket approach, you got three winners that dove the pain of seeing Fastly down 40%.
Moser: Yeah, I can help you catch a few more wings at night and that's a good thing.
Hill: Jason Moser, great talking to you, thanks for being here.
Moser: Thank you.
Hill: As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. That's going to do it for this edition of MarketFoolery. The show is mixed by Dan Boyd. I'm Chris Hill. Thanks for listening. We'll see you tomorrow.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Chris Hill owns shares of Adobe Inc., Alphabet (A shares), Cloudflare, Inc., Etsy, Home Depot, Lowes, and Microsoft. Jason Moser owns shares of Adobe Inc., Alphabet (C shares), Bill.com Holdings, Inc., Cloudflare, Inc., Etsy, and Shopify. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Bill.com Holdings, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, Elastic, Etsy, Fastly, Home Depot, Lemonade, Inc., Microsoft, Netflix, Shopify, and Tesla. The Motley Fool recommends Adobe Inc., Lowes, and Verizon Communications and recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Remember Elastic develops software and services that enables users to search through structured and unstructured data for all sorts of consumer and enterprise applications. But then, one of the real tells for me, just about a year and a half ago, Founder and CEO Artur Bergman, stepped down and that was in the midst of a business that was starting to witness some headwinds. Hill: You look at the 25-year track record of the acquisitions that Cisco Systems has made and I guess if you're a shareholder, take comfort in the fact that if they end up buying Fastly, they've overpaid far worth for other businesses in the past couple of decades.
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Chris Hill owns shares of Adobe Inc., Alphabet (A shares), Cloudflare, Inc., Etsy, Home Depot, Lowes, and Microsoft. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Bill.com Holdings, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, Elastic, Etsy, Fastly, Home Depot, Lemonade, Inc., Microsoft, Netflix, Shopify, and Tesla. The Motley Fool recommends Adobe Inc., Lowes, and Verizon Communications and recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify.
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Now, when I mentioned that 75% number, that to me, I start thinking, OK, well, if their business is ultimately depending on purchasing insurance from other insurers, well then that puts a lot of the power in those other insurers' hands. Hill: As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Bill.com Holdings, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, Elastic, Etsy, Fastly, Home Depot, Lemonade, Inc., Microsoft, Netflix, Shopify, and Tesla.
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I think ultimately Fastly is a business I was interested in for a while. When the market opportunity seems like it's pretty big, that's why I think this strategy works out even better. Hill: Jason Moser, great talking to you, thanks for being here.
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19377806-fd5f-4425-b300-6c7a56cd859c
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718831.0
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2021-09-09 00:00:00 UTC
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Noteworthy Thursday Option Activity: GEVO, DDOG, DLR
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DDOG
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https://www.nasdaq.com/articles/noteworthy-thursday-option-activity%3A-gevo-ddog-dlr-2021-09-09
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nan
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nan
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Gevo Inc (Symbol: GEVO), where a total of 123,184 contracts have traded so far, representing approximately 12.3 million underlying shares. That amounts to about 156.5% of GEVO's average daily trading volume over the past month of 7.9 million shares. Especially high volume was seen for the $7.50 strike call option expiring September 17, 2021, with 36,480 contracts trading so far today, representing approximately 3.6 million underlying shares of GEVO. Below is a chart showing GEVO's trailing twelve month trading history, with the $7.50 strike highlighted in orange:
Datadog Inc (Symbol: DDOG) options are showing a volume of 36,808 contracts thus far today. That number of contracts represents approximately 3.7 million underlying shares, working out to a sizeable 128.3% of DDOG's average daily trading volume over the past month, of 2.9 million shares. Especially high volume was seen for the $142 strike call option expiring September 10, 2021, with 7,879 contracts trading so far today, representing approximately 787,900 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $142 strike highlighted in orange:
And Digital Realty Trust Inc (Symbol: DLR) options are showing a volume of 13,256 contracts thus far today. That number of contracts represents approximately 1.3 million underlying shares, working out to a sizeable 125.2% of DLR's average daily trading volume over the past month, of 1.1 million shares. Particularly high volume was seen for the $125 strike put option expiring October 15, 2021, with 6,000 contracts trading so far today, representing approximately 600,000 underlying shares of DLR. Below is a chart showing DLR's trailing twelve month trading history, with the $125 strike highlighted in orange:
For the various different available expirations for GEVO options, DDOG options, or DLR options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $142 strike call option expiring September 10, 2021, with 7,879 contracts trading so far today, representing approximately 787,900 underlying shares of DDOG. Below is a chart showing GEVO's trailing twelve month trading history, with the $7.50 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 36,808 contracts thus far today. That number of contracts represents approximately 3.7 million underlying shares, working out to a sizeable 128.3% of DDOG's average daily trading volume over the past month, of 2.9 million shares.
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Below is a chart showing GEVO's trailing twelve month trading history, with the $7.50 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 36,808 contracts thus far today. That number of contracts represents approximately 3.7 million underlying shares, working out to a sizeable 128.3% of DDOG's average daily trading volume over the past month, of 2.9 million shares. Especially high volume was seen for the $142 strike call option expiring September 10, 2021, with 7,879 contracts trading so far today, representing approximately 787,900 underlying shares of DDOG.
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Below is a chart showing GEVO's trailing twelve month trading history, with the $7.50 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 36,808 contracts thus far today. That number of contracts represents approximately 3.7 million underlying shares, working out to a sizeable 128.3% of DDOG's average daily trading volume over the past month, of 2.9 million shares. Especially high volume was seen for the $142 strike call option expiring September 10, 2021, with 7,879 contracts trading so far today, representing approximately 787,900 underlying shares of DDOG.
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Below is a chart showing DLR's trailing twelve month trading history, with the $125 strike highlighted in orange: For the various different available expirations for GEVO options, DDOG options, or DLR options, visit StockOptionsChannel.com. Below is a chart showing GEVO's trailing twelve month trading history, with the $7.50 strike highlighted in orange: Datadog Inc (Symbol: DDOG) options are showing a volume of 36,808 contracts thus far today. That number of contracts represents approximately 3.7 million underlying shares, working out to a sizeable 128.3% of DDOG's average daily trading volume over the past month, of 2.9 million shares.
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54513d8c-6df8-452c-b2fd-857232799921
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718832.0
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2021-09-04 00:00:00 UTC
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Datadog Inc - Class A Shares Close in on 52-Week High - Market Mover
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DDOG
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https://www.nasdaq.com/articles/datadog-inc-class-a-shares-close-in-on-52-week-high-market-mover-2021-09-04
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nan
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nan
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Datadog Inc - Class A (DDOG) shares closed today at 1.2% below its 52 week high of $139.68, giving the company a market cap of $33B. The stock is currently up 40.2% year-to-date, up 72.4% over the past 12 months, and up 267.7% over the past five years. This week, the Dow Jones Industrial Average fell 0.1%, and the S&P 500 rose 0.6%.
Trading Activity
Trading volume this week was 31.7% lower than the 20-day average.
Beta, a measure of the stock’s volatility relative to the overall market stands at 1.3.
Technical Indicators
The Relative Strength Index (RSI) on the stock was between 30 and 70.
MACD, a trend-following momentum indicator, indicates a downward trend.
The stock closed below its Bollinger band, indicating it may be oversold.
The stock closed at 0.7% higher than its 5-day moving average, 3.5% higher than its 20-day moving average, and 30.3% higher than its 90-day moving average.
Market Comparative Performance
The company's share price is the same as the S&P 500 Index , beats it on a 1-year basis, and beats it on a 5-year basis
The company's share price is the same as the Dow Jones Industrial Average , beats it on a 1-year basis, and beats it on a 5-year basis
The company share price is the same as the performance of its peers in the Information Technology industry sector , beats it on a 1-year basis, and lags it on a 5 year basis
Per Group Comparative Performance
The company's stock price performance year-to-date beats the peer average by -3073.6%
The company's stock price performance over the past 12 months beats the peer average by 1732.5%
This story was produced by the Kwhen Automated News Generator. For more articles like this, please visit us at finance.kwhen.com. Write to editors@kwhen.com. © 2020 Kwhen Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog Inc - Class A (DDOG) shares closed today at 1.2% below its 52 week high of $139.68, giving the company a market cap of $33B. This week, the Dow Jones Industrial Average fell 0.1%, and the S&P 500 rose 0.6%. Beta, a measure of the stock’s volatility relative to the overall market stands at 1.3.
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Datadog Inc - Class A (DDOG) shares closed today at 1.2% below its 52 week high of $139.68, giving the company a market cap of $33B. This week, the Dow Jones Industrial Average fell 0.1%, and the S&P 500 rose 0.6%. The stock closed at 0.7% higher than its 5-day moving average, 3.5% higher than its 20-day moving average, and 30.3% higher than its 90-day moving average.
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Datadog Inc - Class A (DDOG) shares closed today at 1.2% below its 52 week high of $139.68, giving the company a market cap of $33B. The stock closed at 0.7% higher than its 5-day moving average, 3.5% higher than its 20-day moving average, and 30.3% higher than its 90-day moving average. Market Comparative Performance The company's share price is the same as the S&P 500 Index , beats it on a 1-year basis, and beats it on a 5-year basis The company's share price is the same as the Dow Jones Industrial Average , beats it on a 1-year basis, and beats it on a 5-year basis The company share price is the same as the performance of its peers in the Information Technology industry sector , beats it on a 1-year basis, and lags it on a 5 year basis Per Group Comparative Performance The company's stock price performance year-to-date beats the peer average by -3073.6% The company's stock price performance over the past 12 months beats the peer average by 1732.5%
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Datadog Inc - Class A (DDOG) shares closed today at 1.2% below its 52 week high of $139.68, giving the company a market cap of $33B. This week, the Dow Jones Industrial Average fell 0.1%, and the S&P 500 rose 0.6%. Technical Indicators The Relative Strength Index (RSI) on the stock was between 30 and 70.
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54ee720f-fa88-471f-aaf3-db91c7671a05
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718833.0
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2021-09-03 00:00:00 UTC
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Top 12 High-Growth Artificial Intelligence Stocks
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DDOG
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https://www.nasdaq.com/articles/top-12-high-growth-artificial-intelligence-stocks-2021-09-03
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nan
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nan
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Artificial intelligence is all around us. But what is it, and how can it help your portfolio grow? The recommendations you receive shopping online, smart devices, self-driving vehicles, email spam filters, and robots are just a handful of AI examples. The reality is that the term is very broad, and it includes many categories and opportunities.
Today I am launching a new video series covering 12 top AI stocks focused on growth and disruptive innovation. I have done my best to find the highest-growth companies in a variety of sectors with disruptive growth trends. In the video below, I cover an introduction to artificial intelligence and explain the different types of AI, from machine learning to deep learning, robotics, and beyond. After the background, I provide analysis on my first three AI stock ideas (stocks 10 to 12 in the series):
Upstart (NASDAQ: UPST), a fintech/banking disruptor.
Butterfly Network (NYSE: BFLY), a healthcare disruptor.
Planet Labs (NYSE: DMYQ), which is involved in space exploration and big data analytics.
You won't want to miss this series. Please watch the video below and subscribe to make sure you don't miss the upcoming videos.
*Stock prices used in the below video were during the trading day of September 2, 2021. The video was published on September 2, 2021.
Find out why Upstart Holdings, Inc. is one of the 10 best stocks to buy now
Our award-winning analyst team has spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed their ten top stock picks for investors to buy right now. Upstart Holdings, Inc. is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of August 9, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Eric Cuka owns shares of Alphabet (A shares), Amazon, CrowdStrike Holdings, Inc., Datadog, DraftKings Inc., Marvell Technology Group, and Microsoft. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, CrowdStrike Holdings, Inc., Datadog, Microsoft, and Upstart Holdings, Inc. The Motley Fool recommends Marvell Technology Group and recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool has a disclosure policy. Eric is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The recommendations you receive shopping online, smart devices, self-driving vehicles, email spam filters, and robots are just a handful of AI examples. Today I am launching a new video series covering 12 top AI stocks focused on growth and disruptive innovation. *Stock Advisor returns as of August 9, 2021 John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors.
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Eric Cuka owns shares of Alphabet (A shares), Amazon, CrowdStrike Holdings, Inc., Datadog, DraftKings Inc., Marvell Technology Group, and Microsoft. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, CrowdStrike Holdings, Inc., Datadog, Microsoft, and Upstart Holdings, Inc. The Motley Fool recommends Marvell Technology Group and recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon.
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After the background, I provide analysis on my first three AI stock ideas (stocks 10 to 12 in the series): Upstart (NASDAQ: UPST), a fintech/banking disruptor. *Stock Advisor returns as of August 9, 2021 John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, CrowdStrike Holdings, Inc., Datadog, Microsoft, and Upstart Holdings, Inc.
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Today I am launching a new video series covering 12 top AI stocks focused on growth and disruptive innovation. Please watch the video below and subscribe to make sure you don't miss the upcoming videos. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, CrowdStrike Holdings, Inc., Datadog, Microsoft, and Upstart Holdings, Inc.
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d9f5565b-e5a2-4b67-9359-ecbab1a47bce
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718834.0
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2021-09-02 00:00:00 UTC
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These Earnings Winners Are Up Over 10% After Hours Thursday
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DDOG
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https://www.nasdaq.com/articles/these-earnings-winners-are-up-over-10-after-hours-thursday-2021-09-02
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nan
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nan
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Wall Street continued to celebrate the bull market, with unemployment claims numbers falling to their lowest since before the COVID-19 pandemic and stoking confidence in the economic recovery. The S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) set new records yet again, and the Dow Jones Industrial Average (DJINDICES: ^DJI) managed to see the biggest gains of the three benchmarks.
INDEX
PERCENTAGE CHANGE
POINT CHANGE
Dow
+0.37%
+131
S&P 500
+0.28%
+13
Nasdaq
+0.14%
+22
Data source: Yahoo! Finance.
The late rush of earnings continued after the end of the regular session on Thursday, prompting some big moves in after-hours trading. Two companies in particular -- MongoDB (NASDAQ: MDB) and PagerDuty (NYSE: PD) -- posted gains of more than 10% after their respective financial reports. Below, we'll look more closely at why shareholders are so excited about these two tech plays.
Image source: Getty Images.
Mongo gains for MongoDB
MongoDB shares were up 2% in the regular session, and then added another 12% in the after-hours session as of 5 p.m. EDT. The database specialist wowed investors with its second-quarter financial results and suggested the good times could continue.
MongoDB's numbers were encouraging. Total revenue was up 44% from the year-ago period to $198.7 million, boosted largely by increasing subscription revenue. In particular, MongoDB's Atlas platform saw its sales rise 83% year over year, reflecting demand among major corporate clients to have the full power of a modern data platform to fit with their broader digital innovation strategies.
Customers are adopting MongoDB at an extremely high rate, and the company reported passing 200 million total downloads of the service from its website. More than 75 million of those downloads have come in just the past 12 months. That's more interest than MongoDB got in its first 11 years as a database company.
MongoDB also released encouraging guidance for the remainder of the year. Full-year fiscal 2022 revenue should come in between $805 million and $811 million, and those figures are far above what most investors were expecting and would represent year-over-year sales gains of about 37%. MongoDB isn't close to profitability yet, but investors are content with the top-line growth path they're seeing right now from the database specialist.
Paging big gains
PagerDuty also got a nice advance after hours. After finishing the regular session up more than 1%, the digital operations management specialist's stock got a 12% boost after releasing its second-quarter results.
PagerDuty celebrated solid top-line performance. Revenue climbed 33% year over year to $67.5 million. That seemed like largely enough to satisfy investors, given adjusted gross margin slumped about 3 percentage points to 84.2%, operating losses were substantially higher from year-ago levels, free cash flow worsened to an outflow of $12.9 million, and adjusted net losses of $0.13 per share were more than triple last year's $0.04 per share loss.
PagerDuty has done a good job of landing high-profile clients. The company now sports more than 18,000 clients, having brought on Citigroup during the period. PagerDuty was also proud about its expanded services offerings for key organizations like Autodesk, Nvidia, Datadog, and Snowflake, among others.
Investors were pleased to see expectations of further growth, with full-year fiscal 2022 revenue projected at $273 million to $276 million. Year-over-year gains of 28% to 29% would be stronger than most were looking for from PagerDuty, and the after-hour gains are bringing the company back to within spitting distance of its all-time highs from immediately after its IPO in 2019.
10 stocks we like better than MongoDB
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They just revealed what they believe are the ten best stocks for investors to buy right now... and MongoDB wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of August 9, 2021
Citigroup is an advertising partner of The Ascent, a Motley Fool company. Dan Caplinger owns shares of Datadog, MongoDB, and Snowflake Inc. The Motley Fool owns shares of and recommends Autodesk, Datadog, MongoDB, Nvidia, PagerDuty, and Snowflake Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Wall Street continued to celebrate the bull market, with unemployment claims numbers falling to their lowest since before the COVID-19 pandemic and stoking confidence in the economic recovery. The S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) set new records yet again, and the Dow Jones Industrial Average (DJINDICES: ^DJI) managed to see the biggest gains of the three benchmarks. Customers are adopting MongoDB at an extremely high rate, and the company reported passing 200 million total downloads of the service from its website.
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After finishing the regular session up more than 1%, the digital operations management specialist's stock got a 12% boost after releasing its second-quarter results. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. The Motley Fool owns shares of and recommends Autodesk, Datadog, MongoDB, Nvidia, PagerDuty, and Snowflake Inc.
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Two companies in particular -- MongoDB (NASDAQ: MDB) and PagerDuty (NYSE: PD) -- posted gains of more than 10% after their respective financial reports. Mongo gains for MongoDB MongoDB shares were up 2% in the regular session, and then added another 12% in the after-hours session as of 5 p.m. EDT. The Motley Fool owns shares of and recommends Autodesk, Datadog, MongoDB, Nvidia, PagerDuty, and Snowflake Inc.
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MongoDB isn't close to profitability yet, but investors are content with the top-line growth path they're seeing right now from the database specialist. Revenue climbed 33% year over year to $67.5 million. See the 10 stocks *Stock Advisor returns as of August 9, 2021 Citigroup is an advertising partner of The Ascent, a Motley Fool company.
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46860e1a-7173-48e8-975f-050f8eb23a13
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718835.0
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2021-09-01 00:00:00 UTC
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Better Cloud Stock: Domo vs. Datadog
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DDOG
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https://www.nasdaq.com/articles/better-cloud-stock%3A-domo-vs.-datadog-2021-09-01
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nan
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nan
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Domo (NASDAQ: DOMO) and Datadog (NASDAQ: DDOG) might not be familiar names to many tech investors, but both cloud-oriented stocks outperformed the Nasdaq Exchange's 30% rally over the past 12 months.
Domo's stock price rose over 130% as it generated stable growth with rising margins and narrowing losses. Datadog's stock price advanced more than 60% as it generated robust sales growth with rising profits. Let's see why both stocks impressed the bulls -- and if either stock is worth buying right now.
image source: Getty Images.
What do Domo and Datadog do?
Domo and Datadog both break down silos across companies and pull their fragmented data onto unified dashboards. However, the two companies break down different types of silos.
Domo's platform enables executives to manage their companies through their phones via data visualization and management tools. It gathers data from a wide range of computing platforms and software applications, then organizes that data onto a unified dashboard to help executives make informed business decisions. Domo also provides collaboration and marketing tools for employees.
Datadog's platform enables IT professionals to simultaneously monitor the performance of multiple servers, databases, cloud services, applications, and mobile apps through unified dashboards. That unified view makes it easier to diagnose problems while saving a lot of time and money.
How fast are Domo and Datadog growing?
Domo's revenue rose 22% in fiscal 2020, grew 21% in fiscal 2021, and increased 23% year over year to $123 million in the first half of 2022. It expects its revenue to rise 20%-22% for the full year.
Domo's growth is steady because it generated 87% of its revenue from subscriptions in the first half of 2021. It ended the second quarter with a net retention rate of over 100%, while 60% of its customers were locked into multi-year contracts -- compared to 58% in the prior-year quarter.
The gross margin of that subscription revenue has also gradually expanded over the past three and half years, supported by the stickiness of its services and lower cloud hosting costs.
Datadog's revenue rose 83% in fiscal 2019, grew 66% in fiscal 2020, and increased 59% to $432 million in the first half of 2021. It expects its revenue to rise 55%-56% for the full year.
Datadog's gross and operating margins expanded in 2020, but its gross margin dipped in the first half of 2021 as it integrated its recent acquisitions of the data visualization companies Timber and Sqreen.
Datadog has kept its dollar-based net retention rate above 130% for 16 straight quarters. Last quarter, 70% of its customers were using two or more of its products, up from 68% in the prior-year quarter. Those numbers indicate Datadog's "land and expand" model -- wherein it locks in a customer with a single product to cross-sell additional ones -- is still paying off.
Which company has a clearer path toward profitability?
Neither of these companies is consistently profitable on a GAAP basis yet. But on a non-GAAP basis, Datadog is in much better shape than Domo.
Domo's non-GAAP net loss narrowed from $103 million in fiscal 2020 to $51 million in fiscal 2021, then narrowed again year over year from $29 million to $18 million in the first half of fiscal 2022. Analysts expect its non-GAAP net loss to narrow for the full year.
Datadog generated a non-GAAP net profit of $72 million in fiscal 2020, compared to a net loss of $471,000 in 2019. In the first half of 2021, its non-GAAP net income increased 44% year over year to $52 million. Wall Street expects its non-GAAP earnings to rise 27% this year.
Which stock is more reasonably valued?
Domo trades at 11 times this year's sales. That makes it comparable to Salesforce (NYSE: CRM), which expects to grow its revenue 23%-24% this year and trades at 10 times that estimate.
Datadog trades at 45 times this year's sales. Datadog is growing about as fast as Twilio (NYSE: TWLO). Analysts expect Twilio's revenue to rise 52% this year, and its stock trades at 24 times that forecast.
Based on those comparisons, Domo seems much more reasonably valued than Datadog, which is arguably priced for perfection at these frothy levels.
The winner: Domo
Domo generates predictable growth at a reasonable valuation, while Datadog generates faster -- but decelerating -- growth at a much higher valuation.
I'm not a big fan of either stock right now. Domo's growth is stable, but Salesforce -- which competes against Domo with Tableau -- is generating stronger growth at a lower valuation. Salesforce is also consistently profitable by GAAP and non-GAAP measures.
Datadog's revenue growth is impressive and its profitability is improving, but its stock is simply too expensive. If Datadog's growth abruptly stalls out and it loses ground to similar companies like Splunk, investors shouldn't be surprised if its stock gets cut in half.
So for now, I believe Domo is the better cloud-oriented play, and it should continue to outperform Datadog throughout the rest of the year. However, investors should shop around before deciding if Domo is the right fit for their portfolios.
10 stocks we like better than Domo, Inc.
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See the 10 stocks
*Stock Advisor returns as of August 9, 2021
Leo Sun owns shares of Salesforce.com. The Motley Fool owns shares of and recommends Datadog, Salesforce.com, Splunk, and Twilio. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Domo (NASDAQ: DOMO) and Datadog (NASDAQ: DDOG) might not be familiar names to many tech investors, but both cloud-oriented stocks outperformed the Nasdaq Exchange's 30% rally over the past 12 months. Datadog's platform enables IT professionals to simultaneously monitor the performance of multiple servers, databases, cloud services, applications, and mobile apps through unified dashboards. The gross margin of that subscription revenue has also gradually expanded over the past three and half years, supported by the stickiness of its services and lower cloud hosting costs.
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Domo (NASDAQ: DOMO) and Datadog (NASDAQ: DDOG) might not be familiar names to many tech investors, but both cloud-oriented stocks outperformed the Nasdaq Exchange's 30% rally over the past 12 months. Domo's stock price rose over 130% as it generated stable growth with rising margins and narrowing losses. Domo's non-GAAP net loss narrowed from $103 million in fiscal 2020 to $51 million in fiscal 2021, then narrowed again year over year from $29 million to $18 million in the first half of fiscal 2022.
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Domo (NASDAQ: DOMO) and Datadog (NASDAQ: DDOG) might not be familiar names to many tech investors, but both cloud-oriented stocks outperformed the Nasdaq Exchange's 30% rally over the past 12 months. Domo's non-GAAP net loss narrowed from $103 million in fiscal 2020 to $51 million in fiscal 2021, then narrowed again year over year from $29 million to $18 million in the first half of fiscal 2022. The winner: Domo Domo generates predictable growth at a reasonable valuation, while Datadog generates faster -- but decelerating -- growth at a much higher valuation.
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Domo (NASDAQ: DOMO) and Datadog (NASDAQ: DDOG) might not be familiar names to many tech investors, but both cloud-oriented stocks outperformed the Nasdaq Exchange's 30% rally over the past 12 months. What do Domo and Datadog do? Datadog generated a non-GAAP net profit of $72 million in fiscal 2020, compared to a net loss of $471,000 in 2019.
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d93c0594-d3f9-4988-bb93-134296f3a1f4
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718836.0
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2021-08-31 00:00:00 UTC
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Splunk's Progress on Its Cloud Business Is Starting to Yield Results
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DDOG
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https://www.nasdaq.com/articles/splunks-progress-on-its-cloud-business-is-starting-to-yield-results-2021-08-31
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nan
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nan
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While not the fastest-growing name in the data management software space, Splunk (NASDAQ: SPLK) is still far and away the leader among its peers. Nevertheless, patience will remain essential for shareholders here. Splunk is still changing as its customers migrate to a more modern cloud-based format. Over the last year, that change from legacy software to the cloud has equated to a hot accounting mess. But Splunk's makeover is starting to yield results, as shown in its Q2 fiscal 2022 report.
Image source: Getty Images.
A return to positive cash generation is imminent
Splunk reported yet another quarter of solid annual recurring revenue growth (or ARR, which combines the annualized value of all cloud and legacy software sales). And with cloud-specific ARR now over one-third of the total (compared to less than 30% in the same period last year, when cloud software was nearly doubling year-over-year), Splunk's actual realized revenue for Q2 2022 (the three months ended July 31, 2021) was regaining positive traction. Q2 revenue was nearly $606 million, up 23% from last year. As a reminder, Splunk's rapid move to cloud-based customer billing was creating a short-term decline in realized sales over the last year.
FISCAL YEAR PERIOD
CLOUD ARR
YOY GROWTH
TOTAL ARR
YOY GROWTH
Q2 2021
$568 million
89%
$1.93 billion
50%
Q3 2021
$630 millino
71%
$2.07 billion
44%
Q4 2021
$810 million
83%
$2.36 billion
41%
Q1 2022
$877 million
83%
$2.47 billion
39%
Q2 2022
$976 million
72%
$2.63 billion
37%
Data source: Splunk. ARR = annual recurring revenue.
Splunk's cloud business is still growing at a rapid pace, but with the initial wave of customer transitions now in the rearview mirror, the billing effects aren't creating as big a drag on the bottom line anymore. Free cash flow was back in negative territory in Q2, but through the first half of the current fiscal year totaled positive $5.2 million. Management said to expect positive operating cash flow of $100 million for full-year fiscal 2022 on total revenue of at least $2.53 billion (or total ARR of at least $3.09 billion).
A big market with plenty of options
What does all of this mean? Though Splunk is still a bit behind the curve in the modern cloud era, it's making progress on this front. And while billing effects made it appear Splunk was moving backward during fiscal 2021, that wasn't (and still isn't) the case. This is a growth company in the data analytics and cloud observability industry.
Nevertheless, Splunk is an incumbent here. It's still by far the largest player among its peers, but companies like Datadog, Elastic, and Dynatrace are working hard to catch up.
Data by YCharts.
Don't write off Splunk just yet, though. This is a big market, and cloud computing (and all the basic tools that will be needed to manage cloud operations) will be a massive industry by the end of the decade, encompassing some $1 trillion a year in global spending. As part of its own transformation, Splunk launched new data observability and cybersecurity services in the last quarter alone, and received a $1 billion investment from private equity firm Silverlake to help. It finished out July 2021 with cash and investments of nearly $2.54 billion, offset by convertible debt of $3.05 billion.
It isn't the cleanest balance sheet, but Splunk's return to positive cash generation by the end of the year should start to fix that -- not to mention give it the continued ability to make more strategic acquisitions of smaller data management software outfits. This journey into the next chapter of Splunk's growth story is far from over, but it's starting to pay off for patient shareholders.
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See the 10 stocks
*Stock Advisor returns as of August 9, 2021
Nicholas Rossolillo and his clients own shares of Dynatrace Holdings LLC and Splunk. The Motley Fool owns shares of and recommends Datadog, Elastic, and Splunk. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And with cloud-specific ARR now over one-third of the total (compared to less than 30% in the same period last year, when cloud software was nearly doubling year-over-year), Splunk's actual realized revenue for Q2 2022 (the three months ended July 31, 2021) was regaining positive traction. Splunk's cloud business is still growing at a rapid pace, but with the initial wave of customer transitions now in the rearview mirror, the billing effects aren't creating as big a drag on the bottom line anymore. It isn't the cleanest balance sheet, but Splunk's return to positive cash generation by the end of the year should start to fix that -- not to mention give it the continued ability to make more strategic acquisitions of smaller data management software outfits.
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A return to positive cash generation is imminent Splunk reported yet another quarter of solid annual recurring revenue growth (or ARR, which combines the annualized value of all cloud and legacy software sales). As a reminder, Splunk's rapid move to cloud-based customer billing was creating a short-term decline in realized sales over the last year. Management said to expect positive operating cash flow of $100 million for full-year fiscal 2022 on total revenue of at least $2.53 billion (or total ARR of at least $3.09 billion).
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A return to positive cash generation is imminent Splunk reported yet another quarter of solid annual recurring revenue growth (or ARR, which combines the annualized value of all cloud and legacy software sales). Management said to expect positive operating cash flow of $100 million for full-year fiscal 2022 on total revenue of at least $2.53 billion (or total ARR of at least $3.09 billion). It isn't the cleanest balance sheet, but Splunk's return to positive cash generation by the end of the year should start to fix that -- not to mention give it the continued ability to make more strategic acquisitions of smaller data management software outfits.
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$976 million 72% $2.63 billion 37% Data source: Splunk. Management said to expect positive operating cash flow of $100 million for full-year fiscal 2022 on total revenue of at least $2.53 billion (or total ARR of at least $3.09 billion). After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.
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20d4e47d-effd-44b3-99ab-7b0357691c17
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718837.0
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2021-08-25 00:00:00 UTC
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This Tech Stock Continues to Tumble Despite Rising Revenue. Is It Time to Buy?
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DDOG
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https://www.nasdaq.com/articles/this-tech-stock-continues-to-tumble-despite-rising-revenue.-is-it-time-to-buy-2021-08-25
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nan
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nan
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Down nearly 60% from its all-time high and 40% year to date, Alteryx (NYSE: AYX) has not seen the recent returns that its tech brethren have enjoyed. Despite reporting favorable second-quarter results, the stock dipped another 14%. Given these disappointing returns, it would be reasonable to assume Alteryx's core business is in trouble.
But you'd be wrong. Alteryx's revenue increased 25% over last year's second-quarter numbers. Annual recurring revenue increased even quicker and was up 27%. While customer growth was only 10%, Alteryx's land and expand business model means these new additions will produce a larger amount of revenue in the future. This approach relies on getting new clients to try Alteryx's product—the landing phase. After the benefits of the platform are realized, more licenses are purchased and the buyer expands their usage. Expansion shouldn't be a problem with Alteryx, as their customers rave about Alteryx's products.
Image source: Getty Images.
Customers can't praise Alteryx enough
Alteryx makes software for data scientists and analysts. These tools allow them to be extremely efficient by automating processes. Its Designer software allows analysts to perform 100-hour tasks in as little as two minutes and speeds up diagnostic model creation by 20 times . Once their models are set up, data can be automatically processed and sent to information dashboards .
Alteryx has also integrated with different cloud servers, like AWS, Azure, and Snowflake. With all of these features and more, it's no wonder Alteryx's core product is popular among its 7,405 customers.
Their flagship software, Alteryx Designer, has an average rating of 4.7 stars out of 5 on Gartner . Nearly every one of these reviews includes comments about how the product changed the way their company does business. Designer is useful for companies of all sizes, with massive operations such as Coca-Cola (NYSE: KO) and Walmart (NYSE: WMT) utilizing Alteryx's product as well as not-for-profit entities like AAA or the University of Dayton .
Alteryx innovates among little competition
Opposition is fairly light for Alteryx as well. In their last annual filing, they noted the fact that their biggest competitor at the moment is manual spreadsheets. New entrants are always a threat in any industry, but without much current contention, Alteryx is free to focus on its own development.
In 2020, they released two new solutions, Analytics Hub and Intelligence Suite. Analytics Hub allows data scientists and analysts from across the customer's company to work together and discover potential solutions their colleagues have come up with already. For example, two employees who have never met one another could utilize each other's work by searching their business's Analytics Hub. This prevents wasted time and resources by having predeveloped solutions for many data scientists to utilize. Intelligence Suite incorporates machine learning and text mining to help Alteryx Designer better process unstructured data. As Alteryx expands its library of products, it demonstrates the innovation and optionality that all successful companies exhibit.
What's in store for the future?
While Alteryx is only guiding for a disappointing 6% revenue growth for the fiscal year 2021, its annual recurring revenue is expected to grow by nearly 30%. This is the key metric to watch, as this is sustainable revenue. Its dollar-based net expansion rate was 130% this past quarter and this number has not dipped past 125% in the last 2 years. Clearly, companies that stick with Alteryx's product suite find enough value in it to spend more each year.
Currently, Alteryx is not consistently profitable, so the price-to-earnings metric is not of much use. The price-to-sales ratio is currently hovering below 10, making it an extremely low valued tech stock compared to high fliers such as Datadog (NASDAQ: DDOG) or Crowdstrike (NASDAQ: CRWD) that trade near 50. With a relatively low valuation and strong recurring revenue growth ahead, Alteryx seems like a smart place to put your money.
10 stocks we like better than Alteryx
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Alteryx wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of August 9, 2021
Keithen Drury owns shares of Alteryx and CrowdStrike Holdings, Inc. The Motley Fool owns shares of and recommends Alteryx, CrowdStrike Holdings, Inc., and Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The price-to-sales ratio is currently hovering below 10, making it an extremely low valued tech stock compared to high fliers such as Datadog (NASDAQ: DDOG) or Crowdstrike (NASDAQ: CRWD) that trade near 50. Down nearly 60% from its all-time high and 40% year to date, Alteryx (NYSE: AYX) has not seen the recent returns that its tech brethren have enjoyed. While customer growth was only 10%, Alteryx's land and expand business model means these new additions will produce a larger amount of revenue in the future.
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The price-to-sales ratio is currently hovering below 10, making it an extremely low valued tech stock compared to high fliers such as Datadog (NASDAQ: DDOG) or Crowdstrike (NASDAQ: CRWD) that trade near 50. Customers can't praise Alteryx enough Alteryx makes software for data scientists and analysts. The Motley Fool owns shares of and recommends Alteryx, CrowdStrike Holdings, Inc., and Datadog.
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The price-to-sales ratio is currently hovering below 10, making it an extremely low valued tech stock compared to high fliers such as Datadog (NASDAQ: DDOG) or Crowdstrike (NASDAQ: CRWD) that trade near 50. Expansion shouldn't be a problem with Alteryx, as their customers rave about Alteryx's products. Customers can't praise Alteryx enough Alteryx makes software for data scientists and analysts.
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The price-to-sales ratio is currently hovering below 10, making it an extremely low valued tech stock compared to high fliers such as Datadog (NASDAQ: DDOG) or Crowdstrike (NASDAQ: CRWD) that trade near 50. While customer growth was only 10%, Alteryx's land and expand business model means these new additions will produce a larger amount of revenue in the future. Customers can't praise Alteryx enough Alteryx makes software for data scientists and analysts.
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1d72a730-3ac6-4cac-bf84-c4c76be57ba8
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718838.0
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2021-08-15 00:00:00 UTC
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My 2019 Report Card: Up 319%
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DDOG
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https://www.nasdaq.com/articles/my-2019-report-card%3A-up-319-2021-08-15
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nan
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nan
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As I approach my two-year anniversary of writing for the Fool, I thought it would be interesting to go back and look at all of the bullish calls I made in 2019. In sorting the data, I assumed readers of my articles bought the shares in question at the open of the next trading day. Of course, in real life nobody did that (not even me). But if you had invested an equal dollar amount in every stock I suggested, overall you would have quadrupled your money.
While I'm happy, and I hope you're happy, several of my stocks have underperformed the market, and nine have lost money for shareholders -- so that's humbling. I was wrong multiple times, and I will probably be wrong multiple times this year, too. Sometimes my crystal ball is on the fritz. Anyway, let's dive in and see how I did.
Image Source: Getty Images.
1. First, some numbers
Here are all of my bullish calls in 2019, and how the stocks performed from the time of the hypothetical purchase through Aug. 9, 2021.
STOCK NUMBER OF ARTICLES STOCK PRICE ON THE FIRST TRADING DAY AFTER ARTICLE WAS PUBLISHED IN 2019 STOCK PRICE AT THE END OF TRADING ON AUGUST 9, 2021 PERCENTAGE GAIN
Afterpay 2
$20.00 and $20.55
$99.02 388%
Altus Midstream 1 $49.60 $66.13 33%
Amarin 4
$21.82, $20.65, $20.70, and $14.32
$4.85 (74%)
Apple 2
$71.17 and $67.50
$146.09 111%
Arrowhead Pharmaceuticals 1 $49.39 $62.78 27%
Autodesk 1 $179.31 $332.77 85%
Blue Prism 1 $13.17 $11.62 (12%)
Blueprint Medicines 1 $77.38 $94.50 22%
BridgeBio Pharma 1 $24.83 $53.39 115%
Carvana 1 $67.28 $356.34 430%
CrowdStrike 1 $47.25 $263.56 458%
Datadog 3 $37.30, $32.64, and $36.00 $130 269%
Denali Therapeutics 1 $15.35 $53.49 248%
Disney 1 $147.14 $176.72 20%
Enphase Energy 1 $19.97 $185.56 829%
Farfetch 3 $9.56, $8.38, and $8.82 $47.22 431%
InMode 1 $44.01 $114.26 160%
Innovative Industrial Properties 1 $91.45 $227.86 149%
Ionis Pharmaceuticals 1 $56.27 $38.56 (31%)
Iovance Biotherapeutics 1 $23.66 $24.24 2%
Malibu Boats 2 $39.32 and $38.13 $81.66 111%
MeiraGTx 2 $15.01 and $18.81 $14.71 (12%)
Mirati Therapeutics 1 $104.59 $148.21 42%
MongoDB 2 $139.92 and $117.57 $380.38 206%
Novavax (NASDAQ: NVAX) 2 $4.46 and $4.00 $213.13 4,954%
Personalis 1 $10.40 $20.78 100%
RegenXbio 1 $39.96 $32.50 (19%)
SciPlay 1 $9.46 $17.31 83%
Sea 1 $37.08 $307.14 728%
Shopify 2 $402.76 and $336.00 $1,549.99 327%
SmartSheet 2 $43.93 and $40.49 $71.96 71%
SmileDirectClub 3 $8.05, $11.78, and $13.04 $6.70 (36%)
Solaris Oilfield 1 $12.51 $7.87 (37%)
Square 1 $63.20 $279.73 343%
StoneCo 1 $41.06 $58.15 42%
Ubiquiti 1 $193.75 $310.28 60%
Ubisoft 1 $11.92 $11.80 (1%)
Veeva Systems 1 $148.61 $332.34 124%
Vir Bio 1 $13.80 $40.10 190%
Virgin Galactic 1 $7.33 $35.21 380%
W&T Offshore 1 $4.74 $3.12 (34%)
Zillow 2 $41.15 and $30.13 $101.69 192%
Zoom Video 1 $66.50 $383.34 476%
Data from Yahoo Finance.
If you count all those up, it's 61 bullish calls. The final two are Immunomedics and Glu Mobile. Both companies have been acquired, so they don't exist anymore. Immunomedics in particular had a nice run, jumping from $16 at the time of my article to $88 one year later. But neither stock exists now, so I'm excluding those numbers.
What we're left with is 61 bullish calls on 43 stocks. And what are the lessons we might learn?
2. Let your winners run
Of course my Novavax calls on Nov. 2 and Nov. 26 had a massive effect on my returns. At the time, shares were going for $4 and pennies. Now Novavax is trading for $213 a share. Obviously in 2019 I had no idea that COVID-19 was about to hit, or that all the vaccine stocks would soon skyrocket.
If you sold Novavax after a double or a triple or a quadruple, that means you sold at $8 a share, or $12 a share, or $16 a share. Think about this for a second. This whole hypothetical port is up 319%, a quadruple in two years. That's an excellent return. But you only get that excellent return if you hold your Novavax shares for the full 4,954% return.
3. Diversify!
One of the ironies of my 2019 performance was that my most bullish stock pick (by number of articles written) was Amarin -- but Amarin was my worst performer by far, losing 74% of its value. In my hypothetical portfolio, I invested twice as much in Amarin (four articles = $4,000) as Novavax (two articles = $2,000). In real life, I invested more in Amarin, too. I had more faith in Amarin. I felt it was a sure thing while Novavax was a risky micro cap.
Overall, I had 11 stock picks do better than my 319% overall return: Afterpay, Carvana, CrowdStrike, Enphase, Farfetch, Novavax, Sea, Shopify, Square, Virgin Galactic, and Zoom Video. That means the other 50 stocks were actually dragging down my returns. And of course it's not easy for a stock to quadruple in two years. Shopify, my favorite stock, barely did it (up 327%). Ditto with Square, my second favorite stock (up 342%).
It might be a good idea to look at your portfolio and ask yourself whether any of your stocks can go up 10,000% from these levels. If none of your stocks can go that high, you might be risking underperformance. It's really nice -- and sometimes, financially rewarding -- to invest small amounts in high-risk companies with significant upside.
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They just revealed what they believe are the ten best stocks for investors to buy right now... and Novavax wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of August 9, 2021
Taylor Carmichael owns shares of Afterpay Limited, Amarin, Apple, Carvana Co., Datadog, Farfetch Limited, Innovative Industrial Properties, MeiraGTx Holdings plc, Novavax, Sea Limited, Shopify, Smartsheet, SmileDirectClub, Inc., Square, Ubisoft Entertainment, and Walt Disney. The Motley Fool owns shares of and recommends AFTERPAY T FPO, Apple, Autodesk, Carvana Co., CrowdStrike Holdings, Inc., Datadog, Farfetch Limited, InMode Ltd., Innovative Industrial Properties, Ionis Pharmaceuticals, MongoDB, Sea Limited, Shopify, Smartsheet, Square, Stoneco LTD, Veeva Systems, Walt Disney, Zillow Group (A shares), Zillow Group (C shares), and Zoom Video Communications. The Motley Fool recommends Electronic Arts, Gilead Sciences, Ubiquiti Inc., and Ubisoft Entertainment and recommends the following options: long January 2023 $1,140 calls on Shopify, long March 2023 $120 calls on Apple, short January 2023 $1,160 calls on Shopify, and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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As I approach my two-year anniversary of writing for the Fool, I thought it would be interesting to go back and look at all of the bullish calls I made in 2019. Afterpay 2 $20.00 and $20.55 $99.02 388% Altus Midstream 1 $49.60 $66.13 33% Amarin 4 $21.82, $20.65, $20.70, and $14.32 $4.85 (74%) Apple 2 $71.17 and $67.50 $146.09 111% Arrowhead Pharmaceuticals 1 $49.39 $62.78 27% Autodesk 1 $179.31 $332.77 85% Blue Prism 1 $13.17 $11.62 (12%) Blueprint Medicines 1 $77.38 $94.50 22% BridgeBio Pharma 1 $24.83 $53.39 115% Carvana 1 $67.28 $356.34 430% CrowdStrike 1 $47.25 $263.56 458% Datadog 3 $37.30, $32.64, and $36.00 $130 269% Denali Therapeutics 1 $15.35 $53.49 248% Disney 1 $147.14 $176.72 20% Enphase Energy 1 $19.97 $185.56 829% Farfetch 3 $9.56, $8.38, and $8.82 $47.22 431% InMode 1 $44.01 $114.26 160% Innovative Industrial Properties 1 $91.45 $227.86 149% Ionis Pharmaceuticals 1 $56.27 $38.56 (31%) Iovance Biotherapeutics 1 $23.66 $24.24 2% Malibu Boats 2 $39.32 and $38.13 $81.66 111% MeiraGTx 2 $15.01 and $18.81 $14.71 (12%) Mirati Therapeutics 1 $104.59 $148.21 42% MongoDB 2 $139.92 and $117.57 $380.38 206% Novavax (NASDAQ: NVAX) 2 $4.46 and $4.00 $213.13 4,954% Personalis 1 $10.40 $20.78 100% RegenXbio 1 $39.96 $32.50 (19%) SciPlay 1 $9.46 $17.31 83% Sea 1 $37.08 $307.14 728% Shopify 2 $402.76 and $336.00 $1,549.99 327% SmartSheet 2 $43.93 and $40.49 $71.96 71% SmileDirectClub 3 $8.05, $11.78, and $13.04 $6.70 (36%) Solaris Oilfield 1 $12.51 $7.87 (37%) Square 1 $63.20 $279.73 343% StoneCo 1 $41.06 $58.15 42% Ubiquiti 1 $193.75 $310.28 60% Ubisoft 1 $11.92 $11.80 (1%) Veeva Systems 1 $148.61 $332.34 124% Vir Bio 1 $13.80 $40.10 190% Virgin Galactic 1 $7.33 $35.21 380% W&T Offshore 1 $4.74 $3.12 (34%) Zillow 2 $41.15 and $30.13 $101.69 192% Zoom Video 1 $66.50 $383.34 476% Data from Yahoo Finance. Overall, I had 11 stock picks do better than my 319% overall return: Afterpay, Carvana, CrowdStrike, Enphase, Farfetch, Novavax, Sea, Shopify, Square, Virgin Galactic, and Zoom Video.
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See the 10 stocks *Stock Advisor returns as of August 9, 2021 Taylor Carmichael owns shares of Afterpay Limited, Amarin, Apple, Carvana Co., Datadog, Farfetch Limited, Innovative Industrial Properties, MeiraGTx Holdings plc, Novavax, Sea Limited, Shopify, Smartsheet, SmileDirectClub, Inc., Square, Ubisoft Entertainment, and Walt Disney. The Motley Fool owns shares of and recommends AFTERPAY T FPO, Apple, Autodesk, Carvana Co., CrowdStrike Holdings, Inc., Datadog, Farfetch Limited, InMode Ltd., Innovative Industrial Properties, Ionis Pharmaceuticals, MongoDB, Sea Limited, Shopify, Smartsheet, Square, Stoneco LTD, Veeva Systems, Walt Disney, Zillow Group (A shares), Zillow Group (C shares), and Zoom Video Communications. The Motley Fool recommends Electronic Arts, Gilead Sciences, Ubiquiti Inc., and Ubisoft Entertainment and recommends the following options: long January 2023 $1,140 calls on Shopify, long March 2023 $120 calls on Apple, short January 2023 $1,160 calls on Shopify, and short March 2023 $130 calls on Apple.
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Afterpay 2 $20.00 and $20.55 $99.02 388% Altus Midstream 1 $49.60 $66.13 33% Amarin 4 $21.82, $20.65, $20.70, and $14.32 $4.85 (74%) Apple 2 $71.17 and $67.50 $146.09 111% Arrowhead Pharmaceuticals 1 $49.39 $62.78 27% Autodesk 1 $179.31 $332.77 85% Blue Prism 1 $13.17 $11.62 (12%) Blueprint Medicines 1 $77.38 $94.50 22% BridgeBio Pharma 1 $24.83 $53.39 115% Carvana 1 $67.28 $356.34 430% CrowdStrike 1 $47.25 $263.56 458% Datadog 3 $37.30, $32.64, and $36.00 $130 269% Denali Therapeutics 1 $15.35 $53.49 248% Disney 1 $147.14 $176.72 20% Enphase Energy 1 $19.97 $185.56 829% Farfetch 3 $9.56, $8.38, and $8.82 $47.22 431% InMode 1 $44.01 $114.26 160% Innovative Industrial Properties 1 $91.45 $227.86 149% Ionis Pharmaceuticals 1 $56.27 $38.56 (31%) Iovance Biotherapeutics 1 $23.66 $24.24 2% Malibu Boats 2 $39.32 and $38.13 $81.66 111% MeiraGTx 2 $15.01 and $18.81 $14.71 (12%) Mirati Therapeutics 1 $104.59 $148.21 42% MongoDB 2 $139.92 and $117.57 $380.38 206% Novavax (NASDAQ: NVAX) 2 $4.46 and $4.00 $213.13 4,954% Personalis 1 $10.40 $20.78 100% RegenXbio 1 $39.96 $32.50 (19%) SciPlay 1 $9.46 $17.31 83% Sea 1 $37.08 $307.14 728% Shopify 2 $402.76 and $336.00 $1,549.99 327% SmartSheet 2 $43.93 and $40.49 $71.96 71% SmileDirectClub 3 $8.05, $11.78, and $13.04 $6.70 (36%) Solaris Oilfield 1 $12.51 $7.87 (37%) Square 1 $63.20 $279.73 343% StoneCo 1 $41.06 $58.15 42% Ubiquiti 1 $193.75 $310.28 60% Ubisoft 1 $11.92 $11.80 (1%) Veeva Systems 1 $148.61 $332.34 124% Vir Bio 1 $13.80 $40.10 190% Virgin Galactic 1 $7.33 $35.21 380% W&T Offshore 1 $4.74 $3.12 (34%) Zillow 2 $41.15 and $30.13 $101.69 192% Zoom Video 1 $66.50 $383.34 476% Data from Yahoo Finance. See the 10 stocks *Stock Advisor returns as of August 9, 2021 Taylor Carmichael owns shares of Afterpay Limited, Amarin, Apple, Carvana Co., Datadog, Farfetch Limited, Innovative Industrial Properties, MeiraGTx Holdings plc, Novavax, Sea Limited, Shopify, Smartsheet, SmileDirectClub, Inc., Square, Ubisoft Entertainment, and Walt Disney. The Motley Fool owns shares of and recommends AFTERPAY T FPO, Apple, Autodesk, Carvana Co., CrowdStrike Holdings, Inc., Datadog, Farfetch Limited, InMode Ltd., Innovative Industrial Properties, Ionis Pharmaceuticals, MongoDB, Sea Limited, Shopify, Smartsheet, Square, Stoneco LTD, Veeva Systems, Walt Disney, Zillow Group (A shares), Zillow Group (C shares), and Zoom Video Communications.
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First, some numbers Here are all of my bullish calls in 2019, and how the stocks performed from the time of the hypothetical purchase through Aug. 9, 2021. Immunomedics in particular had a nice run, jumping from $16 at the time of my article to $88 one year later. Overall, I had 11 stock picks do better than my 319% overall return: Afterpay, Carvana, CrowdStrike, Enphase, Farfetch, Novavax, Sea, Shopify, Square, Virgin Galactic, and Zoom Video.
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eb5faeb6-01e5-42ca-82b8-133fc96d9c3f
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718839.0
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2021-08-13 00:00:00 UTC
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4 Top Cloud Computing Stocks To Watch Today
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DDOG
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https://www.nasdaq.com/articles/4-top-cloud-computing-stocks-to-watch-today-2021-08-13
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nan
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nan
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4 Hot Cloud Computing Stocks For Your Watchlist Now
Like it or not, the cloud computing industry continues to grow by the day. Accordingly, with the current shift towards digital workspaces, cloud computing stocks are also gaining traction in the stock market now. If anything, the demand, and possible use cases for cloud computing are rapidly increasing in our world today. Before we dive into the details, what exactly is this upcoming tech field might you ask? Well, in essence, cloud computing is a suite of computing services that can be delivered over the Internet or ‘the cloud’. This can range from data storage, networking, analytics, and database services among other computing functions.
Notably, cloud computing serves a wide variety of purposes across numerous industries. We only need to take a look at the largest name in the industry today Amazon (NASDAQ: AMZN) to see this. Just this week, the company’s Amazon Web Services (AWS) division announced two major plays on the operational front. Firstly, General Electric’s (NYSE: GE) Healthcare section is now moving several of its software platforms onto the AWS cloud. Secondly, news broke the day after that AWS also won a $10 billion cloud contract from the U.S. Defense Department.
Meanwhile, other names in the industry also continue to thrive amidst the current uptick in enterprise software spending. Last week, Datadog (NASDAQ: DDOG) smashed consensus estimates in its second-quarter fiscal. The company reported a total revenue of $233.5 million, marking a whopping 67% year-over-year increase. With all this activity in the cloud computing business now, I can understand if investors are keen to jump on. Should you be one of them, here are four to consider in the stock market today.
Best Cloud Computing Stocks To Buy [Or Sell] This Month
Microsoft Corporation (NASDAQ: MSFT)
Alibaba Group Holdings Ltd. (NYSE: BABA)
Salesforce.com Inc. (NYSE: CRM)
Snowflake Inc. (NYSE: SNOW)
Microsoft Corporation
First off, we have Microsoft Corporation, a multinational tech company whose products and services are used by billions all over the world. Namely, its computer software and consumer services are immensely popular. For instance, its Microsoft Windows operating system is used by over 1.5 billion users worldwide. MSFT stock currently trades at $291.46 as of 11:22 a.m. ET and is up by over 35% in the past year. In late July, the company announced very strong fourth-quarter results.
To begin with, its revenue for the quarter was $46.2 billion, an increase of 21% year-over-year. The company also reported an operating income of $19.1 billion, up by 42% from a year earlier. Net income was $16.5 billion for the quarter, increasing by 49% year-over-year.
In fact, the company notes that its revenue this quarter is driven by cloud services. Impressively, revenue from its Intelligent Cloud segment was $17.4 billion, increasing by 30% year-over-year. Given the impressive financials, will you consider buying MSFT stock?
Source: TD Ameritrade TOS
Read More
4 Top Semiconductor Stocks To Watch This Week
Best Lithium Battery Stocks To Buy Now? 4 To Know
Alibaba Group Holding Ltd
Alibaba is a company that specializes in cloud computing and e-commerce. Its Alibaba Cloud, also known as Aliyun, provides cloud computing services to online businesses and also the company’s own e-commerce ecosystem. Also, the company has a digital media and entertainment business. BABA stock currently trades at $187.92 as of 11:22 a.m. ET. On August 3, 2021, the company reported a stellar quarter. Firstly, it delivered a revenue of $31.86 billion for the quarter, an increase of 34% year-over-year. Secondly, annual active consumers of the Alibaba Ecosystem across the world reached approximately 1.18 billion users.
This includes 912 million consumers in China and 265 million consumers overseas served by Lazada, AliExpress, Trendyol, and Daraz. The company also reported a net income of $6.63 billion and diluted earnings per share was $0.32. Alibaba says that it has multiple engines driving its long-term growth, expanding upon its consumer and industrial internet segments.
Daniel Zhang, Chairman and Chief Executive Officer of Alibaba Group had this to say, “We believe in the growth of the Chinese economy and long-term value creation of Alibaba, and we will continue to strengthen our technology advantage in improving the consumer experience and helping our enterprise customers to accomplish successful digital transformations.” All things considered, will you add BABA stock to your watchlist?
Source: TD Ameritrade TOS
[Read More] Best Stocks To Buy Now? 5 Autonomous Vehicle Stocks To Watch
Salesforce.com
Salesforce is a cloud-based company with headquarters in San Francisco, California. The company is the world’s No. 1 customer relationship management (CRM) platform. Also, its cloud-based CRM applications are used for sales, service, marketing, and do not require IT, experts, to set up or manage. The company boasts more than 150,000 companies that use its platform to grow their businesses by strengthening customer relationships. CRM stock currently trades at $250.66 as of 11:23 a.m. ET.
On Tuesday, the company announced Salesforce+, a new streaming service for live experiences and original content series. The new service will include live experiences, original series, podcasts, and other programming. In detail, Salesforce+ will bring the magic of Dreamforce to viewers across the globe with speakers, success stories, and groundbreaking innovations.
Furthermore, with engaging stories and expert advice, Salesforce+ will illuminate the future of technology in the digital-first, work anywhere world. For these reasons, will you consider CRM stock a top cloud computing stock to watch?
Source: TD Ameritrade TOS
[Read More] 4 Artificial Intelligence Stocks To Watch Right Now
Snowflake Inc.
Next up, we will be taking a look at Snowflake. In brief, it identifies itself as a cloud computing-based data warehousing company. Through Snowflake’s Data Cloud, organizations across the globe can make the most of their digital assets. According to Snowflake, it helps customers unite siloed data, discover and securely share data, and execute diverse analytic workloads. Among its thousands of clients spanning various industries, Snowflake now serves 187 of the Fortune 500 companies.
As it stands, SNOW stock currently trades at $290.08 a share as of 11:23 a.m. ET. Could the company have more room to grow moving forward? Well, for one thing, Snowflake continues to make strategic partnerships in the tech world. Just last month, the company announced support for The Trade Desk’s (NASDAQ: TTD) Unified ID 2.0. (UID 2.0).
Namely, this would be a strategic play by Snowflake as more companies shift from conventional third-party ad trackers to TTD’s ad tool. With UID 2.0 on the Snowflake Data Marketplace, customers can now optimize their conventional ad businesses to be more “privacy-conscious”. Overall, Snowflake appears to be catering to the shifting needs of its users. Could all this make SNOW stock a top pick in the stock market for you?
Source: TD Ameritrade TOS
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Last week, Datadog (NASDAQ: DDOG) smashed consensus estimates in its second-quarter fiscal. Just this week, the company’s Amazon Web Services (AWS) division announced two major plays on the operational front. Firstly, General Electric’s (NYSE: GE) Healthcare section is now moving several of its software platforms onto the AWS cloud.
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Last week, Datadog (NASDAQ: DDOG) smashed consensus estimates in its second-quarter fiscal. Best Cloud Computing Stocks To Buy [Or Sell] This Month Microsoft Corporation (NASDAQ: MSFT) Alibaba Group Holdings Ltd. (NYSE: BABA) Salesforce.com Inc. (NYSE: CRM) Snowflake Inc. (NYSE: SNOW) Microsoft Corporation First off, we have Microsoft Corporation, a multinational tech company whose products and services are used by billions all over the world. Source: TD Ameritrade TOS Read More 4 Top Semiconductor Stocks To Watch This Week Best Lithium Battery Stocks To Buy Now?
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Last week, Datadog (NASDAQ: DDOG) smashed consensus estimates in its second-quarter fiscal. 4 Hot Cloud Computing Stocks For Your Watchlist Now Like it or not, the cloud computing industry continues to grow by the day. Best Cloud Computing Stocks To Buy [Or Sell] This Month Microsoft Corporation (NASDAQ: MSFT) Alibaba Group Holdings Ltd. (NYSE: BABA) Salesforce.com Inc. (NYSE: CRM) Snowflake Inc. (NYSE: SNOW) Microsoft Corporation First off, we have Microsoft Corporation, a multinational tech company whose products and services are used by billions all over the world.
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Last week, Datadog (NASDAQ: DDOG) smashed consensus estimates in its second-quarter fiscal. 4 Hot Cloud Computing Stocks For Your Watchlist Now Like it or not, the cloud computing industry continues to grow by the day. Well, in essence, cloud computing is a suite of computing services that can be delivered over the Internet or ‘the cloud’.
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a2832965-1634-42e6-abda-5f4053083a72
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718840.0
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2021-08-10 00:00:00 UTC
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Notable Tuesday Option Activity: DM, DDOG, HYRE
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DDOG
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https://www.nasdaq.com/articles/notable-tuesday-option-activity%3A-dm-ddog-hyre-2021-08-10
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nan
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nan
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Desktop Metal Inc (Symbol: DM), where a total of 48,535 contracts have traded so far, representing approximately 4.9 million underlying shares. That amounts to about 130.4% of DM's average daily trading volume over the past month of 3.7 million shares. Particularly high volume was seen for the $10 strike call option expiring August 20, 2021, with 30,101 contracts trading so far today, representing approximately 3.0 million underlying shares of DM. Below is a chart showing DM's trailing twelve month trading history, with the $10 strike highlighted in orange:
Datadog Inc (Symbol: DDOG) saw options trading volume of 31,142 contracts, representing approximately 3.1 million underlying shares or approximately 130.4% of DDOG's average daily trading volume over the past month, of 2.4 million shares. Especially high volume was seen for the $130 strike call option expiring September 17, 2021, with 8,959 contracts trading so far today, representing approximately 895,900 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $130 strike highlighted in orange:
And HyreCar Inc (Symbol: HYRE) options are showing a volume of 6,128 contracts thus far today. That number of contracts represents approximately 612,800 underlying shares, working out to a sizeable 118.3% of HYRE's average daily trading volume over the past month, of 518,185 shares. Especially high volume was seen for the $20 strike call option expiring August 20, 2021, with 2,141 contracts trading so far today, representing approximately 214,100 underlying shares of HYRE. Below is a chart showing HYRE's trailing twelve month trading history, with the $20 strike highlighted in orange:
For the various different available expirations for DM options, DDOG options, or HYRE options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $130 strike call option expiring September 17, 2021, with 8,959 contracts trading so far today, representing approximately 895,900 underlying shares of DDOG. Below is a chart showing DM's trailing twelve month trading history, with the $10 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 31,142 contracts, representing approximately 3.1 million underlying shares or approximately 130.4% of DDOG's average daily trading volume over the past month, of 2.4 million shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $130 strike highlighted in orange: And HyreCar Inc (Symbol: HYRE) options are showing a volume of 6,128 contracts thus far today.
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Below is a chart showing DM's trailing twelve month trading history, with the $10 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 31,142 contracts, representing approximately 3.1 million underlying shares or approximately 130.4% of DDOG's average daily trading volume over the past month, of 2.4 million shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $130 strike highlighted in orange: And HyreCar Inc (Symbol: HYRE) options are showing a volume of 6,128 contracts thus far today. Especially high volume was seen for the $130 strike call option expiring September 17, 2021, with 8,959 contracts trading so far today, representing approximately 895,900 underlying shares of DDOG.
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Below is a chart showing DM's trailing twelve month trading history, with the $10 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 31,142 contracts, representing approximately 3.1 million underlying shares or approximately 130.4% of DDOG's average daily trading volume over the past month, of 2.4 million shares. Especially high volume was seen for the $130 strike call option expiring September 17, 2021, with 8,959 contracts trading so far today, representing approximately 895,900 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $130 strike highlighted in orange: And HyreCar Inc (Symbol: HYRE) options are showing a volume of 6,128 contracts thus far today.
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Below is a chart showing DM's trailing twelve month trading history, with the $10 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 31,142 contracts, representing approximately 3.1 million underlying shares or approximately 130.4% of DDOG's average daily trading volume over the past month, of 2.4 million shares. Below is a chart showing HYRE's trailing twelve month trading history, with the $20 strike highlighted in orange: For the various different available expirations for DM options, DDOG options, or HYRE options, visit StockOptionsChannel.com. Especially high volume was seen for the $130 strike call option expiring September 17, 2021, with 8,959 contracts trading so far today, representing approximately 895,900 underlying shares of DDOG.
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13972bb2-bfe9-4e7e-b3eb-214bcabaa7dd
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718841.0
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2021-08-06 00:00:00 UTC
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DDOG Crosses Above Average Analyst Target
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DDOG
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https://www.nasdaq.com/articles/ddog-crosses-above-average-analyst-target-2021-08-06
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nan
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nan
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $116.87, changing hands for $132.47/share. When a stock reaches the target an analyst has set, the analyst logically has two ways to react: downgrade on valuation, or, re-adjust their target price to a higher level. Analyst reaction may also depend on the fundamental business developments that may be responsible for driving the stock price higher — if things are looking up for the company, perhaps it is time for that target price to be raised.
There are 15 different analyst targets within the Zacks coverage universe contributing to that average for Datadog Inc, but the average is just that — a mathematical average. There are analysts with lower targets than the average, including one looking for a price of $97.00. And then on the other side of the spectrum one analyst has a target as high as $150.00. The standard deviation is $14.715.
But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $116.87/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $116.87 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? Below is a table showing the current thinking of the analysts that cover Datadog Inc:
RECENT DDOG ANALYST RATINGS BREAKDOWN
» Current 1 Month Ago 2 Month Ago 3 Month Ago
Strong buy ratings: 11 10 10 7
Buy ratings: 1 1 1 1
Hold ratings: 6 7 8 11
Sell ratings: 0 0 0 0
Strong sell ratings: 0 0 0 0
Average rating: 1.72 1.83 1.89 2.21
The average rating presented in the last row of the above table above is from 1 to 5 where 1 is Strong Buy and 5 is Strong Sell. This article used data provided by Zacks Investment Research via Quandl.com. Get the latest Zacks research report on DDOG — FREE.
10 ETFs With Most Upside To Analyst Targets »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $116.87, changing hands for $132.47/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $116.87/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $116.87 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $116.87, changing hands for $132.47/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $116.87/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $116.87 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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And so with DDOG crossing above that average target price of $116.87/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $116.87 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $116.87, changing hands for $132.47/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes.
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In recent trading, shares of Datadog Inc (Symbol: DDOG) have crossed above the average analyst 12-month target price of $116.87, changing hands for $132.47/share. But the whole reason to look at the average DDOG price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with DDOG crossing above that average target price of $116.87/share, investors in DDOG have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $116.87 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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d3cace39-0f5f-4053-8c6b-4610c929630a
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718842.0
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2021-08-05 00:00:00 UTC
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Nothing's Stopping These 2 Nasdaq Winners After Earnings
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DDOG
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https://www.nasdaq.com/articles/nothings-stopping-these-2-nasdaq-winners-after-earnings-2021-08-05
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nan
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nan
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Earnings reports are coming fast and furious right now, and what investors are seeing is driving market action. Although there's a mix of positive and negative reports across the market, those watching had a generally favorable view of how companies are doing, and that helped send the Nasdaq Composite (NASDAQINDEX: ^IXIC) up more than half a percent as of noon EDT.
Two companies that did a great job of impressing their shareholders were Latin American e-commerce giant MercadoLibre (NASDAQ: MELI) and cloud-based data analytics specialist Datadog (NASDAQ: DDOG). Both companies saw their stocks soar Thursday, and below, we'll look at what they said in their earnings reports that made investors so pleased.
MercadoLibre heats up
Shares of MercadoLibre soared 13% Thursday morning. The e-commerce specialist's second-quarter financial results included promising news about the resilience of the Latin American economy and MercadoLibre's ability to tap into growth trends there.
A lot of good things happened with MercadoLibre during the quarter. Gross merchandise volume was up nearly 40% year over year to $7 billion, with active users climbing 47% to 75.9 million and items sold hitting 245 million, up 37%. Total payment volume on the company's Mercado Pago electronic payment system topped the $17.5 billion mark, up 56%, on an 80% rise in total payment transactions to 730 million. More than 70% of that payment volume took place off-network, showing that Mercado Pago is gaining strength in its own right, independent of MercadoLibre's e-commerce marketplace.
Image source: Getty Images.
That success translated into strong financial performance. Revenue soared 94% to $1.7 billion, with commerce revenue nearly doubling and big boosts in fintech-related sales as well. Net income rose 22% from the year-ago quarter.
As in other parts of the world, the COVID-19 pandemic has forced businesses to pivot to e-commerce channels. MercadoLibre has benefited from that, and even an economic reopening won't stop people from taking advantage of the convenience of online retail going forward.
Datadog is an investor's best friend
Meanwhile, shares of Datadog rose nearly 14%. Investors reacted favorably to continued growth in the company's second-quarter financial report.
Datadog saw revenue move higher by 67% from year-ago levels, powered by the cloud monitoring platform provider signing up almost 600 new customers over the past year that generate $100,000 or more in annual recurring revenue. Adjusted earnings came in at $0.09 per share, and Datadog got a big lift from the launch of its cloud security platform to add breadth to its previous offerings.
Investors were also pleased about what Datadog sees coming down the road for the remainder of the year. The company expects revenue of between $246 million and $248 million in the third quarter, with earnings of $0.05 to $0.06 per share. For the full year, Datadog provided guidance for sales of between $938 million and $944 million and earnings of $0.26 to $0.28 per share.
Companies around the world have gone through massive digital transformation efforts, and Datadog has been an essential tool in building out technology capabilities. Although the pandemic definitely gave cloud adoption a boost, Datadog is showing that clients remain convinced of the long-term value of taking full advantage of cutting-edge tech to the greatest extent possible.
10 stocks we like better than MercadoLibre
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now… and MercadoLibre wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of June 7, 2021
Dan Caplinger owns shares of Datadog and MercadoLibre. The Motley Fool owns shares of and recommends Datadog and MercadoLibre. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two companies that did a great job of impressing their shareholders were Latin American e-commerce giant MercadoLibre (NASDAQ: MELI) and cloud-based data analytics specialist Datadog (NASDAQ: DDOG). Although there's a mix of positive and negative reports across the market, those watching had a generally favorable view of how companies are doing, and that helped send the Nasdaq Composite (NASDAQINDEX: ^IXIC) up more than half a percent as of noon EDT. The e-commerce specialist's second-quarter financial results included promising news about the resilience of the Latin American economy and MercadoLibre's ability to tap into growth trends there.
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Two companies that did a great job of impressing their shareholders were Latin American e-commerce giant MercadoLibre (NASDAQ: MELI) and cloud-based data analytics specialist Datadog (NASDAQ: DDOG). Total payment volume on the company's Mercado Pago electronic payment system topped the $17.5 billion mark, up 56%, on an 80% rise in total payment transactions to 730 million. For the full year, Datadog provided guidance for sales of between $938 million and $944 million and earnings of $0.26 to $0.28 per share.
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Two companies that did a great job of impressing their shareholders were Latin American e-commerce giant MercadoLibre (NASDAQ: MELI) and cloud-based data analytics specialist Datadog (NASDAQ: DDOG). For the full year, Datadog provided guidance for sales of between $938 million and $944 million and earnings of $0.26 to $0.28 per share. See the 10 stocks *Stock Advisor returns as of June 7, 2021 Dan Caplinger owns shares of Datadog and MercadoLibre.
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Two companies that did a great job of impressing their shareholders were Latin American e-commerce giant MercadoLibre (NASDAQ: MELI) and cloud-based data analytics specialist Datadog (NASDAQ: DDOG). Both companies saw their stocks soar Thursday, and below, we'll look at what they said in their earnings reports that made investors so pleased. Investors reacted favorably to continued growth in the company's second-quarter financial report.
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b792427b-608e-4350-ba18-abc0147543cc
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718843.0
|
2021-08-05 00:00:00 UTC
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Why Datadog Stock Jumped on Thursday
|
DDOG
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https://www.nasdaq.com/articles/why-datadog-stock-jumped-on-thursday-2021-08-05
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nan
|
nan
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What happened
Shares of monitoring and analytics platform specialist Datadog (NASDAQ: DDOG) jumped on Thursday. The stock rose as much as 17.8%. As of 12:30 p.m. EDT, however, the growth stock was up 14%.
The stock's sharp gain was due to the company's strong second-quarter results, which were reported before market open on Thursday.
Image source: Getty Images.
So what
Datadog's revenue surged 67% year over year to $233.5 million. Non-GAAP (adjusted) earnings per share increased from $0.05 in the year-ago period to $0.09. Both of these figures easily surpassed analysts' average estimates for revenue of $212.5 million and adjusted earnings per share of $0.03.
"We saw broad-based strength across customer segments and products," said Datadog CEO Olivier Pomel in the company's earnings release. "Our high growth at scale demonstrates that we continue to be a trusted partner in our customers' digital transformation and cloud migration journeys."
Now what
Management's bullish outlook for the full year may be helping the stock as well on Thursday. The company lifted its full-year view for revenue and non-GAAP earnings per share significantly.
Datadog now expects 2021 revenue between $938 million and $944 million, up from a previous forecast for revenue between $880 million and $890 million. Further, management lifted its view for adjusted earnings per share from a range of $0.13 to $0.16 to expectation for the key profitability metric to be between $0.26 and $0.28.
10 stocks we like better than Datadog
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of June 7, 2021
Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of monitoring and analytics platform specialist Datadog (NASDAQ: DDOG) jumped on Thursday. The stock's sharp gain was due to the company's strong second-quarter results, which were reported before market open on Thursday. "We saw broad-based strength across customer segments and products," said Datadog CEO Olivier Pomel in the company's earnings release.
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What happened Shares of monitoring and analytics platform specialist Datadog (NASDAQ: DDOG) jumped on Thursday. Non-GAAP (adjusted) earnings per share increased from $0.05 in the year-ago period to $0.09. The company lifted its full-year view for revenue and non-GAAP earnings per share significantly.
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What happened Shares of monitoring and analytics platform specialist Datadog (NASDAQ: DDOG) jumped on Thursday. Datadog now expects 2021 revenue between $938 million and $944 million, up from a previous forecast for revenue between $880 million and $890 million. 10 stocks we like better than Datadog When our award-winning analyst team has a stock tip, it can pay to listen.
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What happened Shares of monitoring and analytics platform specialist Datadog (NASDAQ: DDOG) jumped on Thursday. Both of these figures easily surpassed analysts' average estimates for revenue of $212.5 million and adjusted earnings per share of $0.03. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.
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600dd568-3555-4c03-ac56-0d36ca4630ab
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718844.0
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2021-08-05 00:00:00 UTC
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Technology Sector Update for 08/05/2021: DDOG, EPAM, FVRR, XLK, SOXX
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DDOG
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https://www.nasdaq.com/articles/technology-sector-update-for-08-05-2021%3A-ddog-epam-fvrr-xlk-soxx-2021-08-05
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Technology stocks were climbing premarket Thursday. The Technology Select Sector SPDR ETF (XLK) was 0.18% higher, and the Semiconductor Sector Index Fund (SOXX) was advancing by 0.61% recently.
Datadog (DDOG) was gaining more than 14% in value as it reported Q2 adjusted earnings of $0.09 per diluted share, up from $0.05 a year earlier. The consensus of analysts polled by Capital IQ was $0.03.
EPAM Systems (EPAM) was climbing past 3% after it reported Q2 adjusted earnings per diluted share of $2.05, up from $1.46 a year before. Analysts polled by Capital IQ projected $1.94.
Fiverr International (FVRR) was declining by more than 21% even after posting a Q2 adjusted profit of $0.19 per diluted share, up from $0.10 per share last year. Analysts expected adjusted EPS of $0.14 per share, according to Capital IQ.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (DDOG) was gaining more than 14% in value as it reported Q2 adjusted earnings of $0.09 per diluted share, up from $0.05 a year earlier. The Technology Select Sector SPDR ETF (XLK) was 0.18% higher, and the Semiconductor Sector Index Fund (SOXX) was advancing by 0.61% recently. Analysts expected adjusted EPS of $0.14 per share, according to Capital IQ.
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Datadog (DDOG) was gaining more than 14% in value as it reported Q2 adjusted earnings of $0.09 per diluted share, up from $0.05 a year earlier. The consensus of analysts polled by Capital IQ was $0.03. EPAM Systems (EPAM) was climbing past 3% after it reported Q2 adjusted earnings per diluted share of $2.05, up from $1.46 a year before.
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Datadog (DDOG) was gaining more than 14% in value as it reported Q2 adjusted earnings of $0.09 per diluted share, up from $0.05 a year earlier. EPAM Systems (EPAM) was climbing past 3% after it reported Q2 adjusted earnings per diluted share of $2.05, up from $1.46 a year before. Fiverr International (FVRR) was declining by more than 21% even after posting a Q2 adjusted profit of $0.19 per diluted share, up from $0.10 per share last year.
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Datadog (DDOG) was gaining more than 14% in value as it reported Q2 adjusted earnings of $0.09 per diluted share, up from $0.05 a year earlier. Technology stocks were climbing premarket Thursday. The Technology Select Sector SPDR ETF (XLK) was 0.18% higher, and the Semiconductor Sector Index Fund (SOXX) was advancing by 0.61% recently.
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12b7c439-077c-431d-b65f-c7163d32c2cd
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718845.0
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2021-08-05 00:00:00 UTC
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7 Coronavirus Stocks to Buy as the Delta Variant Rises
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DDOG
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https://www.nasdaq.com/articles/7-coronavirus-stocks-to-buy-as-the-delta-variant-rises-2021-08-05
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
As you may have heard, the Delta variant has led to a startling increase in Covid-19 cases around the world. Now, headlines have meant increased choppiness in many stocks. However, there are some picks — we’ll call them coronavirus stocks — that could resist any more bad news.
Of course, this variant has come at a time when we’re seeing very high inflation rates. Specifically, inflation is now at 5.4% — the highest level since 2008. True, Federal Reserve Chair Jerome Powell has indicated that interest rates will not be raised again anytime soon. Still, policy makers could also pause their market-friendly monetary policies to stimulate the economy, if it feels like levels will continue to climb.
So, with all of this in mind, many market participants are now positioning their portfolios for a possible downturn in broader markets, which are at record highs. This is how the major indices have fared year-to-date (YTD):
Dow Jones Industrial Average — up about 14%
S&P 500 — up about 18%
Nasdaq 100 — up about 17%
Delta variant aside, though, investors should not lose heart. There are still encouraging signs in the market, such as soaring consumer spending. When it comes to uncertain times, investors need only be more selective about which stocks to buy, focusing on companies that could rebound after another potential pullback. They should also refrain from overcommitting to typical pandemic investment themes in order to ride out of the current wave of volatility.
7 of the Best Restaurant Stocks to Buy Now as They Begin to Recover
These seven coronavirus stocks could help you do just that. Not only are they lockdown-resistant, but they also have significant upside potential come a high-growth scenario.
Ciena (NYSE:CIEN)
Constellation Brands (NYSE:STZ)
Cyberark Software (NASDAQ:CYBR)
Datadog (NASDAQ:DDOG)
Electronic Arts (NASDAQ:EA)
Fiverr (NYSE:FVRR)
Teladoc Health (NYSE:TDOC)
Coronavirus Stocks to Buy: Ciena (CIEN)
CIEN) sign in Silicon Valley." width="300" height="169">
Source: Michael Vi / Shutterstock.com
52-week range: $38.03 – $61.52
Ciena is a company that offers network hardware, software and services that facilitate and support video, voice and data traffic on communications networks. This company serves a variety of customers, from communication-service providers to governments and large enterprises around the globe.
CIEN released its second-quarter results back in early June. For the period, revenue fell roughly 7% year-over-year (YOY) to $834 million. Net income also came in at $103 million, or 66 cents per diluted share, up from $91.7 million (or 59 cents) in the prior-year quarter. Lastly, cash and equivalents ended Q2 at $1.2 billion. On the results, CEO Gary Smith said the following:
“We delivered strong fiscal second quarter results as we continued to see encouraging signs in the market environment, including improvements in customer spending.”
Currently, demand for Ciena’s products and solutions is thriving, thanks to the ongoing construction of 5G networks and data centers, among other things. Additionally, an improved product mix and increase in software revenue will likely lead to increased margins in the future.
CIEN stock hovers around the $57 mark as of Aug. 5. This name is up 7% YTD. Investors looking to add a growth stock to their portfolios may consider buying CIEN. Today, it trades at 19.71 times forward earnings and 2.44 times forward sales.
Constellation Brands (STZ)
Source: ShinoStock / Shutterstock.com
52-week range: $160.63 – $244.75
Dividend yield: 1.39%
Next up on this list of coronavirus stocks, Constellation Brands is currently one of the largest multi-category alcohol suppliers in the United States. The business is primarily anchored by a portfolio of beer trademarks, including the Corona and Modelo brands.
On Jun. 30, Constellation reported solid Q1 results. For the quarter, net revenue came in at $2.03 billion, up 3% YOY. The net loss for the first quarter was also $908 million, or a loss of $4.74 per diluted share. This is compared to a net loss of $178 million, or 94 cents per diluted share, in the prior-year period. However, STZ saw non-GAAP net income of $457 million. Plus, the company generated $716 million in operating cash flow and $602 million in free cash flow, “an increase of 4% and 11%, respectively.”
All in all, this company’s beer business is booming, maintaining its multi-year record of solid growth thanks to higher-end import brands like Pacifico and Modelo Especial. For the beer business, management forecasts growth of 7% to 9% in 2022. Additionally, Constellation recently entered the hard-seltzer space with its Corona Hard Seltzer.
Lastly, STZ also increased its stock buyback outlook, planning $500 million of stock repurchases during the second quarter. Management aims to pay around $5 billion to shareholders through dividends and buybacks over the next two fiscal years.
7 Cheap Value Stocks To Buy For August 2021
STZ stock currently hovers around $220, up only around 1% YTD. Right now, it trades at 21.55 times forward earnings and 4.9 times forward sales. Interested readers could consider buying into the declines.
Coronavirus Stocks to Buy: Cyberark Software (CYBR)
CYBR) logo on a corporate building" width="300" height="169">
Source: photobyphm / Shutterstock.com
52-week range: $95.12 – $169.70
Based in Israel, Cyberark Software provides information technology (IT) security solutions to protect data, infrastructure and assets.
This pick of the coronavirus stocks announced Q1 results back in early May. For the period, total revenue came to $113 million. The company also reported a GAAP net loss of $15.2 million (or 39 cents per diluted share), compared to a net income of $3.8 million (0r 9 cents per share) a year ago. Lastly, cash and equivalents came to $515 million. Following the results, CEO Udi Mokady remarked the following:
“We were thrilled with the faster than 40 percent growth in our Annual Recurring Revenue (ARR), greater than 250 percent growth in ARR related to SaaS and on-premises subscription contracts, the 180 percent increase in subscription revenue, and that subscription revenue represented 22 percent of total revenue for the quarter.”
All in all, this company is a market leader in the growing and highly strategic privileged-access management space. With more than 30% annual recurring revenue growth forecasted through 2022, Cyberark continues to outpace industry peers.
Right now, CYBR stock currently hovers around $141, down almost 12% YTD. However, CYBR shares have returned over 25% in the past 12 months. Back in February, Morgan Stanley also maintained an “overweight” rating on CYBR stock with a $200 price target.
Today, the stock’s forward price-to-earnings (P/E) and price-to-sales (P/S) ratios stand at 269.23 and 11.62, respectively. A further decline toward the $135 level would improve the margin of safety here.
Datadog (DDOG)
DDOG) logo displayed on a laptop screen." width="300" height="169">
Source: Karol Ciesluk / Shutterstock.com
52-week range: $69.73 – $135.38
Next up is Datadog, a monitoring and analytics platform that facilitates log management, infrastructure monitoring and application performance monitoring. Basically, developers and IT operations teams rely on Datadog for consistent data insight.
Like others on this list, Datadog reported Q1 results in early May. For starters, revenue came in at $199 million, representing a 51% YOY increase. Additionally, the net loss stood at $13 million while non-GAAP net income was up 6% YOY at $20 million. Finally, cash and equivalents ended the quarter at $373 million. On the results, CEO Olivier Pomel remarked:
“Digital transformation projects are being prioritized, as the need to be digital-first and agile is more prominent than ever. We believe we are in a strong position to benefit from this trend as the most complete and cloud-native end-to-end observability platform.”
Altogether, this company has been continuously improving its product suite as well as its network of partners. On Jul. 1, Datadog announced a partnership with Salesforce (NYSE:CRM) to provide “real-time monitoring and threat detection” across its platform. It has also forged a partnership with Microsoft (NASDAQ:MSFT) Azure.
7 F-Rated Stocks to Avoid for the Rest of 2021
DDOG stock recently popped to around $132 and is up nearly 34% YTD. It was also able to recover from the earlier selloff in tech stocks, gaining almost 69% in the past three months. Today, this pick of the coronavirus stocks has forward P/E and P/S ratios of 729.39 and 39.84, respectively.
Coronavirus Stocks to Buy: Electronic Arts (EA)
EA) logo on a wall" width="300" height="169">
Source: Rick Neves / Shutterstock.com
52-week range: $110.15 – $150.30
Dividend yield: 0.36%
Based in California, Electronic Arts is one of the world’s largest video game publishers, making games for multiple consoles, PC and on mobile. This company also owns several large franchises, including the uber-popular Madden, FIFA, Battlefield, Apex Legends and Need for Speed franchises.
EA released its Q4 and fiscal-year 2021 financial results back in mid-May. For the quarter, total revenue stood at roughly $1.35 billion, down 3% YOY from 1.39 billion in the prior-year quarter. Additionally, net income came at $76 million — or 26 cents per diluted share — down 82% from $418 million (or $1.43 per shar) a year ago. Lastly, cash and equivalents ended the quarter at $5.26 billion. On the results, CEO Andrew Wilson remarked the following:
“[EA is] now accelerating in FY22, powered by expansion of our blockbuster franchises to more platforms and geographies, a deep pipeline of new content, and recent acquisitions that will be catalysts for further growth.”
Earlier in the year, this company acquired Glu Mobile for $2.1 billion in order to jump-start its struggling mobile games division. Now, the acquisition is expected to bring in over 500 developers. For the fiscal-year 2022, EA anticipates that it can reach $7.3 billion in net bookings, an 18% improvement from the previous year.
Today, EA stock sits at about $137 — a little below the price it was trading for at the start of 2021. True, this pick of the coronavirus stocks is down for the year. However, given its consistent cash cows and strong tailwinds from the gaming industry, it looks like an excellent pick at the current price. The forward P/E and P/S ratios stand at 21.9 and 5.37, respectively.
Fiverr (FVRR)
Source: Temitiman / Shutterstock.com
52-week range: $90.81 – $336.00
Like Cyberark, Fiverr International is also based in Israel. However, rather than dealing in IT, this company connects businesses with freelancers who offer digital services in more than 300 categories. As you might expect, this company has benefited immensely from the pandemic-fueled shift toward online work over the past year.
Fiverr reported Q1 results in early May. For starters, Fiverr’s revenue doubled YOY to $68.3 million. The company reported a non-GAAP net loss of $0.3 million, or 1 cent per diluted share. That’s compared to a loss of $2.6 million, or 8 cents per diluted share, in the prior-year quarter. Lastly, cash and equivalents ended the quarter at $183 million. On the results, CEO Micha Kaufman said the following:
“We continue to capitalize and execute on the ongoing digital transformation as we delivered one of the strongest quarters in Fiverr’s history with outstanding results across the board, supported by continued execution on our strategy.”
But that’s not all — Fiverr also just recently released its Q2 report, which beat estimates. All told, this company is finally becoming profitable, having reached a turning point where revenue is growing faster than expenses. Now, Fiverr forecasts 2021 revenue to increase between 59% and 63%, up to more than $300 million. The company also estimates that its total addressable market (TAM) is currently worth $115 billion.
6 A-Rated, Safe Stocks to Buy With Dividends
Right now, FVRR stock is trading at about $175, having recently slid from the $250 level. However, shares still do not look extremely cheap, trading at 34.35 times current sales. By comparison, its closest rival, Upwork (NASDAQ:UPWK), trades at only 14.42 times current sales. Nevertheless, if the Delta variant were to lead to lockdowns as in previous months, this pick of the coronavirus stocks could easily climb again.
Coronavirus Stocks to Buy: Teladoc Health (TDOC)
Source: Piotr Swat / Shutterstock.com
52-week range: $129.74 – $308
Last up on this list of coronavirus stocks is TDOC stock. No doubt, the pandemic has helped Teladoc immensely, allowing it become one the world’s largest virtual health providers. Essentially, this company offers on-demand healthcare services, connecting members with a network of physicians and behavioral health professionals.
Teledoc released Q2 results on Jul. 27. For the quarter, revenue grew 109% YOY to $503 million, raising the 2021 revenue outlook to over $2 billion. However, this company’s net loss also came in at $133.8 million, compared to a loss of just $25.7 million in the prior-year quarter. Still, cash and equivalents ended the quarter at about $784 million. On the results, CEO Jason Gorevic noted the following:
“Teladoc Health delivered a strong second quarter, marked by exciting new client wins, product launches, and tremendous progress on our quest to be the category-defining provider of whole person virtual care.”
Over the course of the pandemic, demand for Teladoc’s convenient and fast services has skyrocketed. However, as the outbreak dwindled earlier this summer, investors were worried about the company’s prospects. As a result, TDOC stock has declined by almost 23% YTD. It currently hovers at the $153 mark, less than half of its mid-February 52-week high.
That said, though, TDOC stock could still be well-positioned to sustain its strong momentum — especially if the Delta variant affects our daily lives as significantly as the onset of the pandemic. Plus, patient visits on the platform surged 28% YOY in Q2 to 3.5 million, suggesting that Teladoc can perform well even in a post-pandemic world.
Today, this stock’s forward P/S ratio stands at nearly 11.85. Interested investors could regard a potential drop to $140 or below as a better entry point.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tezcan Gecgil has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education in the field, she has also completed all 3 levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation.
The post 7 Coronavirus Stocks to Buy as the Delta Variant Rises appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Ciena (NYSE:CIEN) Constellation Brands (NYSE:STZ) Cyberark Software (NASDAQ:CYBR) Datadog (NASDAQ:DDOG) Electronic Arts (NASDAQ:EA) Fiverr (NYSE:FVRR) Teladoc Health (NYSE:TDOC) Coronavirus Stocks to Buy: Ciena (CIEN) CIEN) sign in Silicon Valley." Datadog (DDOG) DDOG) logo displayed on a laptop screen." 7 F-Rated Stocks to Avoid for the Rest of 2021 DDOG stock recently popped to around $132 and is up nearly 34% YTD.
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Ciena (NYSE:CIEN) Constellation Brands (NYSE:STZ) Cyberark Software (NASDAQ:CYBR) Datadog (NASDAQ:DDOG) Electronic Arts (NASDAQ:EA) Fiverr (NYSE:FVRR) Teladoc Health (NYSE:TDOC) Coronavirus Stocks to Buy: Ciena (CIEN) CIEN) sign in Silicon Valley." Datadog (DDOG) DDOG) logo displayed on a laptop screen." 7 F-Rated Stocks to Avoid for the Rest of 2021 DDOG stock recently popped to around $132 and is up nearly 34% YTD.
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Ciena (NYSE:CIEN) Constellation Brands (NYSE:STZ) Cyberark Software (NASDAQ:CYBR) Datadog (NASDAQ:DDOG) Electronic Arts (NASDAQ:EA) Fiverr (NYSE:FVRR) Teladoc Health (NYSE:TDOC) Coronavirus Stocks to Buy: Ciena (CIEN) CIEN) sign in Silicon Valley." Datadog (DDOG) DDOG) logo displayed on a laptop screen." 7 F-Rated Stocks to Avoid for the Rest of 2021 DDOG stock recently popped to around $132 and is up nearly 34% YTD.
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Ciena (NYSE:CIEN) Constellation Brands (NYSE:STZ) Cyberark Software (NASDAQ:CYBR) Datadog (NASDAQ:DDOG) Electronic Arts (NASDAQ:EA) Fiverr (NYSE:FVRR) Teladoc Health (NYSE:TDOC) Coronavirus Stocks to Buy: Ciena (CIEN) CIEN) sign in Silicon Valley." Datadog (DDOG) DDOG) logo displayed on a laptop screen." 7 F-Rated Stocks to Avoid for the Rest of 2021 DDOG stock recently popped to around $132 and is up nearly 34% YTD.
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2021-07-14 00:00:00 UTC
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Should You Buy Confluent Stock Now?
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DDOG
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https://www.nasdaq.com/articles/should-you-buy-confluent-stock-now-2021-07-14
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Confluent (NASDAQ: CFLT) is a big data analytics provider that spun off of LinkedIn back in 2014. The technology that supports the Confluent platform is Apache Kafka, an open-source solution that was developed inside LinkedIn, which is owned by Microsoft (NASDAQ: MSFT). Businesses such as Shopify (NYSE: SHOP), Airbnb (NASDAQ: ABNB), Cloudflare (NYSE: NET), Datadog (NASDAQ: DDOG), and many others are powered by Kafka. Confluent's S-1 filing stated, "Our open source roots are a key driver of our go-to-market success. Apache Kafka has become the industry standard for data in motion. It is one of the most successful open source projects, estimated to have been used by over 70% of the Fortune 500."
The company's revenue climbed to $236.8 million last year, which was a 58% increase. However, the company is still not profitable, and it recorded a net loss of nearly $230 million last year.
The company competes and partners with big names such as Amazon (NASDAQ: AMZN), Microsoft, and Alphabet's (NASDAQ: GOOG) (NASDAQ: GOOGL) Google. Several legacy products from vendors such as Cloudera (NYSE: CLDR), IBM's (NYSE: IBM) Red Hat, and Oracle (NYSE: ORCL) have also pivoted into Confluent's space. Even smaller companies such as MongoDB (NASDAQ: MDB), Elastic (NYSE: ESTC), and Databricks, which may go public in 2021, should be mentioned. Without question, competition is fierce in this arena.
That said, the total addressable market (TAM) for Confluent is over $50 billion. The compounded annual growth rate (CAGR) is expected to grow at 22% through 2024, which would increase the TAM to over $90 billion. Here are the components that make up Confluent's core competencies and TAM:
Analytics and business intelligence
Application infrastructure and middleware
Data integration tools and data quality tools
Database management systems
Confluent completed an IPO in late June. Since then, the stock has rocketed to $58, over 75% above the high end of the initial projected range of $29 to $33. The stock has since retreated to the mid-$40 range, placing an $11-billion-plus market cap on the company. Is Confluent stock a buy now?
Today, I provide a deep-dive analysis of Confluent. I explain what the company is all about, the bull case, the bear case, and my thoughts on the price level I would buy. Please watch the below video for my insights.
*Stock prices used in the below video were during the trading day of July 13, 2021. The video was published on July 13, 2021.
10 stocks we like better than Confluent, Inc.
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Confluent, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of June 7, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Eric Cuka owns shares of Airbnb, Inc., Alphabet (A shares), Amazon, Cloudflare, Inc., Datadog, Elastic, Microsoft, MongoDB, and Shopify. The Motley Fool owns shares of and recommends Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Cloudflare, Inc., Datadog, Elastic, Microsoft, MongoDB, and Shopify. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $1,140 calls on Shopify, short January 2022 $1,940 calls on Amazon, and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy. Eric is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Businesses such as Shopify (NYSE: SHOP), Airbnb (NASDAQ: ABNB), Cloudflare (NYSE: NET), Datadog (NASDAQ: DDOG), and many others are powered by Kafka. The technology that supports the Confluent platform is Apache Kafka, an open-source solution that was developed inside LinkedIn, which is owned by Microsoft (NASDAQ: MSFT). Even smaller companies such as MongoDB (NASDAQ: MDB), Elastic (NYSE: ESTC), and Databricks, which may go public in 2021, should be mentioned.
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Businesses such as Shopify (NYSE: SHOP), Airbnb (NASDAQ: ABNB), Cloudflare (NYSE: NET), Datadog (NASDAQ: DDOG), and many others are powered by Kafka. Eric Cuka owns shares of Airbnb, Inc., Alphabet (A shares), Amazon, Cloudflare, Inc., Datadog, Elastic, Microsoft, MongoDB, and Shopify. The Motley Fool owns shares of and recommends Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Cloudflare, Inc., Datadog, Elastic, Microsoft, MongoDB, and Shopify.
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Businesses such as Shopify (NYSE: SHOP), Airbnb (NASDAQ: ABNB), Cloudflare (NYSE: NET), Datadog (NASDAQ: DDOG), and many others are powered by Kafka. See the 10 stocks *Stock Advisor returns as of June 7, 2021 John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. The Motley Fool owns shares of and recommends Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Cloudflare, Inc., Datadog, Elastic, Microsoft, MongoDB, and Shopify.
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Businesses such as Shopify (NYSE: SHOP), Airbnb (NASDAQ: ABNB), Cloudflare (NYSE: NET), Datadog (NASDAQ: DDOG), and many others are powered by Kafka. Confluent (NASDAQ: CFLT) is a big data analytics provider that spun off of LinkedIn back in 2014. 10 stocks we like better than Confluent, Inc.
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2021-07-13 00:00:00 UTC
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Is Datadog (NASDAQ:DDOG) Using Debt Sensibly?
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DDOG
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https://www.nasdaq.com/articles/is-datadog-nasdaq%3Addog-using-debt-sensibly-2021-07-13
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Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of permanent loss is the risk I worry about... and every practical investor I know worries about.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. We can see that Datadog, Inc. (NASDAQ:DDOG) does use debt in its business. But is this debt a concern to shareholders?
When Is Debt A Problem?
Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control. Having said that, the most common situation is where a company manages its debt reasonably well - and to its own advantage. When we think about a company's use of debt, we first look at cash and debt together.
How Much Debt Does Datadog Carry?
As you can see below, at the end of March 2021, Datadog had US$733.0m of debt, up from none a year ago. Click the image for more detail. But on the other hand it also has US$1.55b in cash, leading to a US$814.9m net cash position.
NasdaqGS:DDOG Debt to Equity History July 13th 2021
How Strong Is Datadog's Balance Sheet?
Zooming in on the latest balance sheet data, we can see that Datadog had liabilities of US$320.8m due within 12 months and liabilities of US$789.9m due beyond that. Offsetting these obligations, it had cash of US$1.55b as well as receivables valued at US$154.1m due within 12 months. So it can boast US$591.3m more liquid assets than total liabilities.
This state of affairs indicates that Datadog's balance sheet looks quite solid, as its total liabilities are just about equal to its liquid assets. So while it's hard to imagine that the US$33.2b company is struggling for cash, we still think it's worth monitoring its balance sheet. Simply put, the fact that Datadog has more cash than debt is arguably a good indication that it can manage its debt safely. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately the future profitability of the business will decide if Datadog can strengthen its balance sheet over time. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
Over 12 months, Datadog reported revenue of US$671m, which is a gain of 58%, although it did not report any earnings before interest and tax. With any luck the company will be able to grow its way to profitability.
So How Risky Is Datadog?
Although Datadog had an earnings before interest and tax (EBIT) loss over the last twelve months, it generated positive free cash flow of US$108m. So although it is loss-making, it doesn't seem to have too much near-term balance sheet risk, keeping in mind the net cash. We think its revenue growth of 58% is a good sign. There's no doubt fast top line growth can cure all manner of ills, for a stock. There's no doubt that we learn most about debt from the balance sheet. However, not all investment risk resides within the balance sheet - far from it. We've identified 4 warning signs with Datadog , and understanding them should be part of your investment process.
If, after all that, you're more interested in a fast growing company with a rock-solid balance sheet, then check out our list of net cash growth stocks without delay.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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We can see that Datadog, Inc. (NASDAQ:DDOG) does use debt in its business. NasdaqGS:DDOG Debt to Equity History July 13th 2021 How Strong Is Datadog's Balance Sheet? However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control.
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We can see that Datadog, Inc. (NASDAQ:DDOG) does use debt in its business. NasdaqGS:DDOG Debt to Equity History July 13th 2021 How Strong Is Datadog's Balance Sheet? Zooming in on the latest balance sheet data, we can see that Datadog had liabilities of US$320.8m due within 12 months and liabilities of US$789.9m due beyond that.
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We can see that Datadog, Inc. (NASDAQ:DDOG) does use debt in its business. NasdaqGS:DDOG Debt to Equity History July 13th 2021 How Strong Is Datadog's Balance Sheet? When we think about a company's use of debt, we first look at cash and debt together.
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We can see that Datadog, Inc. (NASDAQ:DDOG) does use debt in its business. NasdaqGS:DDOG Debt to Equity History July 13th 2021 How Strong Is Datadog's Balance Sheet? When we think about a company's use of debt, we first look at cash and debt together.
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206311cd-711b-4e3a-9599-4de6caf31d88
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718848.0
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2021-07-09 00:00:00 UTC
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Top 10 Cloud Stocks to Buy on the Next Dip -- Part II
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DDOG
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https://www.nasdaq.com/articles/top-10-cloud-stocks-to-buy-on-the-next-dip-part-ii-2021-07-09
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nan
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nan
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Last time, I covered stocks six through 10 in my top 10 cloud stocks. Today, I will finish the series with my top five high-conviction cloud stocks to buy on the next dip. These are high-growth software-as-a-service (SaaS) and cloud stocks that I currently hold in my $1.6 million long-term investing portfolio.
In case you missed the last article, I'll provide some background. If you aren't familiar with the terminology, SaaS is simply a component of cloud computing. SaaS refers to software hosted outside of your organization and offered as a subscription-based service. SaaS generally offers businesses lower total cost of ownership. The latest software updates and enhancements are generally done for the client, allowing businesses to have the latest and greatest without additional effort or overhead. Additionally, SaaS enables businesses to shift capital expenses to operating expenses, allowing them to stretch budgets from an accounting perspective.
Cloud computing refers to servers that are connected through the internet, as well as the software, data centers, and databases that create an online network. Leveraging "the cloud" allows users and businesses to consume and analyze data without having to manage databases or software on their own physical, on-premises servers and machines.
Digital transformation, artificial intelligence (AI), cybersecurity, machine learning, centralized analytics, customer relationship management, enterprise resource planning (ERP), connected TV (CTV), streaming, work from anywhere, the gig economy, and other secular growth trends fuel SaaS and cloud infrastructure. But what are the best stocks to buy in order to ride these waves and boost your portfolio?
Here are my top five cloud growth stocks. Please make sure to watch the below video for additional information as well as several bonus picks!
#5. Zscaler (NASDAQ: ZS) offers customers a security stack as a cloud service, which offers lower cost and complexity than "old-school" traditional gateway methods. Zscaler's global infrastructure brings internet gateways closer to users all around the world, creating a faster and more streamlined experience. The company enables work-from-anywhere cloud security in a highly scalable fashion.
#4. Datadog (NASDAQ: DDOG) provides monitoring and analytics tools that give IT teams insights from anywhere and at any time. Datadog, like Zscaler, is very scalable. In fact, most cloud-native providers are highly scalable, which is part of the reason they rank high on the list. Datadog brings information together from across an entire organization into a simple dashboard. Companies that leverage Datadog enjoy benefits such as improved user experience, faster resolutions to interruptions, and overall better business decisions.
Datadog has continuously improved its product suite as well as its partnership network. In fact, Datadog recently announced a new partnership with Microsoft (NASDAQ: MSFT) Azure, which allows streamlined experiences for configuration, purchasing, and even managing Datadog inside the Azure portal. Additionally, on July 1 Datadog announced a partnership with Salesforce to provide real-time monitoring and threat detection across the Salesforce (NYSE: CRM) platform.
From a product perspective, here are the highlights:
Application performance monitoring (APM) provides visibility into application functionality and health.
Infrastructure monitoring allows businesses to monitor IT infrastructure.
Log management provides visualization and data for any performance problems.
User experience monitoring includes both synthetics and real user monitoring (RUM).
Network performance monitoring allows insights and analysis into network traffic flow from both hybrid and cloud environments.
Incident management and continuous profiler improves workflows.
Security monitoring provides threat detection.
#3. Snowflake (NYSE: SNOW) offers what it calls a "data warehouse-as-a-service" (DaaS), a cloud-based data storage and analytics solution. Interestingly, Snowflake is not a SaaS company since its revenues are over 90% consumption based. Snowflake reduces cost and improves agility. Its data platform is unique in that it is not built on an existing big data platform.
As you may have heard around the time of the IPO, Snowflake is backed by Warren Buffett's Berkshire Hathaway (NYSE: BRK.A). Snowflake's clients include Apple (NASDAQ: AAPL), Nike (NYSE: NKE), Mastercard (NYSE: MA), and many others. Snowflake is all about big data, and it deserves a top spot on the list.
#2. Cloudflare's (NYSE: NET) mission is to help "build a better internet." Cloudflare is actually a network. In fact, it's one of the larger networks on the planet. Cloudflare enables a faster and more secure internet for anyone with an internet presence. Cloudflare has data centers across the globe, and it boasts an astonishing 25 million internet properties, a number that grows daily. To date, Cloudflare handles over 17 percent of the Fortune 1000 internet requests, and the company handles 25 million HTTP requests every second on average. Cloudflare is all about the future of the internet, and it belongs in my portfolio as a long-term investment.
#1 Crowdstrike (NASDAQ: CRWD) is the leader in endpoint security. Crowdstrike's Falcon platform stops breaches through both prevention and response, a process known as endpoint detection and response (EDR). It uses agent-based sensors that can be installed on Mac, Linux, and Windows. Crowdstrike relies on a cloud-hosted SaaS platform that manages data and prevents, detects, and responds to threats. Both malware and non-malware attacks are covered via Crowdstrike's cloud-delivered technologies in a lightweight solution.
Cyberattacks continue to be a major threat, and the total addressable market for cybersecurity is enormous. Crowdstrike has been a monster since its IPO in 2019, growing into a $60 billion market cap company. But I think Crowdstrike is just getting started, and it stands tall as my top high-conviction cloud/SaaS stock for the next decade.
If you want deeper-dive analysis on these stocks, please watch the video below, where I cover these and many others in the cloud space. These growth stocks can boost your long-term investing portfolio, so please check out the below video and subscribe to make sure you stay on top of this sector.
10 stocks we like better than Zscaler
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Zscaler wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of June 7, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Eric Cuka owns shares of Adobe Inc., Alphabet (A shares), Amazon, Apple, BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, First Trust ISE Cloud Computing, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., Telos Corporation, The Trade Desk, Twilio, WisdomTree Trust-WisdomTree Cloud Computing Fund, Zoom Video Communications, and Zscaler and has the following options: long August 2021 $40 calls on Palantir Technologies Inc. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., The Trade Desk, Twilio, Workday, Zoom Video Communications, and Zscaler. The Motley Fool recommends Adobe Inc. and recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, short January 2023 $200 puts on Berkshire Hathaway (B shares), short January 2023 $265 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy. Eric is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG) provides monitoring and analytics tools that give IT teams insights from anywhere and at any time. Leveraging "the cloud" allows users and businesses to consume and analyze data without having to manage databases or software on their own physical, on-premises servers and machines. Digital transformation, artificial intelligence (AI), cybersecurity, machine learning, centralized analytics, customer relationship management, enterprise resource planning (ERP), connected TV (CTV), streaming, work from anywhere, the gig economy, and other secular growth trends fuel SaaS and cloud infrastructure.
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Datadog (NASDAQ: DDOG) provides monitoring and analytics tools that give IT teams insights from anywhere and at any time. Eric Cuka owns shares of Adobe Inc., Alphabet (A shares), Amazon, Apple, BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, First Trust ISE Cloud Computing, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., Telos Corporation, The Trade Desk, Twilio, WisdomTree Trust-WisdomTree Cloud Computing Fund, Zoom Video Communications, and Zscaler and has the following options: long August 2021 $40 calls on Palantir Technologies Inc. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., The Trade Desk, Twilio, Workday, Zoom Video Communications, and Zscaler.
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Datadog (NASDAQ: DDOG) provides monitoring and analytics tools that give IT teams insights from anywhere and at any time. Eric Cuka owns shares of Adobe Inc., Alphabet (A shares), Amazon, Apple, BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, First Trust ISE Cloud Computing, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., Telos Corporation, The Trade Desk, Twilio, WisdomTree Trust-WisdomTree Cloud Computing Fund, Zoom Video Communications, and Zscaler and has the following options: long August 2021 $40 calls on Palantir Technologies Inc. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), BlackLine, Inc., Cloudflare, Inc., CrowdStrike Holdings, Inc., Datadog, DocuSign, Fastly, Mastercard, Microsoft, Nike, Okta, Olo Inc., Palantir Technologies Inc., Salesforce.com, ServiceNow, Inc., Snowflake Inc., The Trade Desk, Twilio, Workday, Zoom Video Communications, and Zscaler.
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Datadog (NASDAQ: DDOG) provides monitoring and analytics tools that give IT teams insights from anywhere and at any time. Last time, I covered stocks six through 10 in my top 10 cloud stocks. Here are my top five cloud growth stocks.
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15b86ac2-50a7-4414-a2ce-cfd6e255c5fd
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718849.0
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2021-06-21 00:00:00 UTC
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An Investor's Look at Data Analytics
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DDOG
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https://www.nasdaq.com/articles/an-investors-look-at-data-analytics-2021-06-21
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nan
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nan
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Casey's General Stores (NASDAQ: CASY) wraps up the fiscal year with a rock-solid fourth quarter, and Chipotle (NYSE: CMG) raises wages and menu prices. In this episode of MarketFoolery, Motley Fool analyst Clay Bruning, with host Chris Hill, analyzes those stories and discusses where companies like Sumo Logic (NASDAQ: SUMO) and Datadog (NASDAQ: DDOG) fall in the spectrum of attractiveness for investors interested in data analytics businesses.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.
10 stocks we like better than Caseys General Stores
When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Caseys General Stores wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of June 7, 2021
This video was recorded on June 9, 2021.
Chris Hill: It's Wednesday, June 9th. Welcome to MarketFoolery. I'm Chris Hill, with me today, Clay Burning in the house. Good to see you.
Clay Bruning: Hey, Chris, how is it going?
Hill: It's going well. We've got data analytics to discuss, we've got some restaurant news. We're going to begin in the Midwest, with Casey's General Stores. Casey's wrapped up the fiscal year with a solid fourth quarter, profits and revenue came in higher than expected, same-store sales were up nearly 13%. I mean, I get the stock is down a little bit today, but this seemed like a good quarter.
Bruning: Yeah, it did, and it was a pretty good year overall and to me, this is just a rock solid business, they're consistently growing, not at a staggering pace, I think at a 5%-10% clip on an annual basis, consistently generating profit and using that to fund investments. Most notably, they're acquiring more stores. I think this past quarter they announced they are going to acquire about 50 Circle Case stores, which I'm familiar with from my time in North Carolina so just a rock solid business. They pay the dividends and I think they actually could be a beneficiary to an extent of inflation in terms of being able to pass on some of those costs to customers. Like I said, just a rock solid business that should be just fine.
Hill: It seems like one of those businesses, certainly if you look at this quarter, I mean, part of the story for Casey's was a nice increase in foot traffic in the stores, as more people get vaccinated, as more states open up, and by the way, people are traveling, they need to put gas in the tank, get some snacks, get some pizza, that sort of thing. It seems like Casey's, I don't want to put any pressure on them, but it seems like they're set up for a pretty nice second half to 2021.
Bruning: Yeah, absolutely. Like you said, foot traffic is up and something that caught my eye was they are taking advantage of that digitization, if you will. They noted that 3.6 million rewards members, which is something I always look for because I'm one of those consumers who is constantly eager to get rewards if I'm a loyal customer, and that breeds loyalty, especially for consumers like me. They had 96% growth of digital sales, which I didn't even realize that convenience stores or gas stations have digital sales, so a couple of interesting tidbits that I saw in the press release for the quarter, so encouraging signs both on a post-COVID and COVID impacts there.
Hill: You mentioned inflation, that ties into our next story, which is that last month, Chipotle announced it would raise hourly wages for restaurant workers up to $15 an hour by the end of June. To make up for that, Chipotle has increased prices on the menu by 4% to cover the costs. I get that we are past earnings season, and so it's not the busiest week for news. I mean, I looked at this and I just thought, this seems normal. This seems like the appropriate move.
Bruning: Yeah, and this is close to home to me, I'm a huge Chipotle fan. I have sadly been sitting on the sidelines since I read up a senior thesis on the company and the rebound story with the new CEO coming in from Taco Bell. But I have a quick anecdote here. My local Chipotle, and I live in Montana here, they were constantly having issues in terms of staffing, to the point where they closed the store for in-person ordering, they we're only taking online ordering, and one of the times I caved in and did the online order, which I'm not a huge fan of personally, I like doing the in-person order. I asked one of the line chefs, "You all like this. Is it making you all more efficient?" He said, "We don't really have a choice. We can't hire, we don't have enough staff to fill the stores." This is probably a month and a half ago. Hearing they were going to raise the wages was music to my ears and they've since been able to hire a couple and I can order again in person, which I'm thankful for. But it makes total sense, and I think a lot of consumers, myself included, are more than willing to pay an additional 4% which is probably going to equate to something like $0.20, $0.30 for your chicken burrito. I think this is going to be totally fine. Again, this is another story of a company being able to pass on the cost of inflation onto their customers.
Hill: I get that every business is different. Every restaurant, whether it's an individual mom-and-pop local place, or a national chain like Chipotle, they're all going to make their own decisions and they are all dealing with the same thing though, which is, how do we get people to work here? We're just going to have to decide what we want to do and fortunately, in the Chipotle case, when you think about the way they market themselves, there is not a value proposition to Chipotle. I get if Wendy's, McDonald's, Burger King, which are three successful chains that do offer value meals, I get if they are reticent to boost up wages, because that's part of their proposition, "For this amount of money, we're going to feed you," and I think you're right. I mean, this is a thing Warren Buffet says he loves to see in businesses, pricing power, and Chipotle can't raise prices to the moon, but 4% seems really doable for them.
Bruning: Absolutely.
Hill: Our email address is marketfoolery@fool.com. From Jason Long in Colorado, he writes, "Hi, guys. Jason Moser talked about Elastic on Motley Fool Money recently. I'd be curious to get your take on a company called Sumo Logic. They compete in the same market and announced their most recent earnings last week. What do you think? P.S. I appreciate everything you do in your Stock Advisor service. I've done very well since I signed up 16 months ago. Please let the Stock Advisor team know that they have a happy customer here." Consider it done, Jason. In the same way that when Jason Moser mentioned Elastic and I've never heard of that business before, I never heard of Sumo Logic until this email came in. Am I right that they are in the data analytics industry? Yes?
Bruning: Yeah. They are SaaS company or Software-as-a-Service company that helps address the digital transformation by using automation and data to help build actionable insights for companies. On the service, I love the concept more so because I think their data is the present and it is the future. When you think about just about every single industry is using big data in some way, whether it's machine learning or quantitative analysis and the financial services and you name it. There is going to be data that's being included and it's going to be increasingly used moving forward. I wasn't familiar with this company either. I took a quick look at some of the financials and whatnot, and that's where I had some pause. Their growth is slowing a little bit. They didn't grow quarter-over-quarter at all, 15% year-over-year in the first quarter, versus 45% growth on the revenue side of things, in the first quarter of 2020. In my opinion, I just think there are better opportunities in the data analytics space. A couple of names I'm semi familiar with are Splunk and Datadog, and Datadog would be the one that I'd be most interested in personally so. I think this is starting to be a crowded space and you have to pick the players with some thought and for me personally, after just a quick surface look, Sumo wouldn't be my first deck.
Hill: For all of the opportunities in this industry, do you think we're likely to see some consolidation over the next few years? The reason I asked that is because Sumo Logic went public last fall, the stock is not trading dramatically below where at IPO'd, but it's about 20% below where IPO'd. The listener referenced Jason Moser's mention of Elastic. Elastic's a $11-$12 billion company. Sumo Logic is about a $2 billion company and it seems like if there is going to be consolidation, they could be a candidate to be acquired.
Bruning: Yeah, absolutely and that's what I was about to say if you didn't mention it, it's a $2 billion company. You compare it, like you said, to Elastic, I think you said $14 billion or $15 billion ($11-$12 billion), and then you have the biggest player up incoming player is Datadog. I think they are approaching a $30 billion market cap. I think if the management teams at other companies are interested in acquiring for growth and maybe go for Sumo. There's definitely going to be some consolidation in the space, when you have legacy players like Splunk that are struggling a little bit. They're probably going to try to require growth as well. I think this is definitely an industry to look for some consolidation, and like you said, Sumo's probably fitting that through to it's seat.
Hill: Last thing before I let you go. Does this company might get acquired ever show up on your list when you're thinking about buying a stock, and if so, where does it fall on the list?
Bruning: Yeah, I don't try to think about that when I'm looking at a company, because you can never know the future for sure. I would never use that as a reason to actually put money in a company saying, hey, I think Datadog can acquire this company, it will probably be at a 30%-40% premium. That's just a guess or forecast on something that you have no way of knowing unless you have the insider information, which is a whole nother story. That's not something that I really ever consider.
Hill: You don't want to get the lawyers involved?
Bruning: Yeah, exactly.
Hill: Clay Burning, great talking to you. Thanks for being here.
Bruning: Yeah, thanks for having me on, Chris.
Hill: As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. That's going to do it for this edition of MarketFoolery. The show is mixed by Dan Boyd, I'm Chris Hill. Thanks for listening. We'll see you tomorrow.
Chris Hill has no position in any of the stocks mentioned. Clay Bruning owns shares of Datadog. The Motley Fool owns shares of and recommends Chipotle Mexican Grill, Datadog, Elastic, and Splunk. The Motley Fool recommends Caseys General Stores. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In this episode of MarketFoolery, Motley Fool analyst Clay Bruning, with host Chris Hill, analyzes those stories and discusses where companies like Sumo Logic (NASDAQ: SUMO) and Datadog (NASDAQ: DDOG) fall in the spectrum of attractiveness for investors interested in data analytics businesses. Casey's General Stores (NASDAQ: CASY) wraps up the fiscal year with a rock-solid fourth quarter, and Chipotle (NYSE: CMG) raises wages and menu prices. Every restaurant, whether it's an individual mom-and-pop local place, or a national chain like Chipotle, they're all going to make their own decisions and they are all dealing with the same thing though, which is, how do we get people to work here?
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In this episode of MarketFoolery, Motley Fool analyst Clay Bruning, with host Chris Hill, analyzes those stories and discusses where companies like Sumo Logic (NASDAQ: SUMO) and Datadog (NASDAQ: DDOG) fall in the spectrum of attractiveness for investors interested in data analytics businesses. Casey's General Stores (NASDAQ: CASY) wraps up the fiscal year with a rock-solid fourth quarter, and Chipotle (NYSE: CMG) raises wages and menu prices. Jason Moser talked about Elastic on Motley Fool Money recently.
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In this episode of MarketFoolery, Motley Fool analyst Clay Bruning, with host Chris Hill, analyzes those stories and discusses where companies like Sumo Logic (NASDAQ: SUMO) and Datadog (NASDAQ: DDOG) fall in the spectrum of attractiveness for investors interested in data analytics businesses. Hill: It seems like one of those businesses, certainly if you look at this quarter, I mean, part of the story for Casey's was a nice increase in foot traffic in the stores, as more people get vaccinated, as more states open up, and by the way, people are traveling, they need to put gas in the tank, get some snacks, get some pizza, that sort of thing. Hill: As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear.
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In this episode of MarketFoolery, Motley Fool analyst Clay Bruning, with host Chris Hill, analyzes those stories and discusses where companies like Sumo Logic (NASDAQ: SUMO) and Datadog (NASDAQ: DDOG) fall in the spectrum of attractiveness for investors interested in data analytics businesses. I think this is starting to be a crowded space and you have to pick the players with some thought and for me personally, after just a quick surface look, Sumo wouldn't be my first deck. Bruning: Yeah, I don't try to think about that when I'm looking at a company, because you can never know the future for sure.
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51f199cc-d729-4028-afb1-0d2b52023f34
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718850.0
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2021-06-17 00:00:00 UTC
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Interesting DDOG Put And Call Options For June 18th
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DDOG
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https://www.nasdaq.com/articles/interesting-ddog-put-and-call-options-for-june-18th-2021-06-17
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nan
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nan
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Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the June 18th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new June 18th contracts and identified one put and one call contract of particular interest.
The put contract at the $92.50 strike price has a current bid of 8 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $92.50, but will also collect the premium, putting the cost basis of the shares at $92.42 (before broker commissions). To an investor already interested in purchasing shares of DDOG, that could represent an attractive alternative to paying $100.10/share today.
Because the $92.50 strike represents an approximate 8% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 100%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 0.09% return on the cash commitment, or 31.57% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Datadog Inc, and highlighting in green where the $92.50 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $105.00 strike price has a current bid of 17 cents. If an investor was to purchase shares of DDOG stock at the current price level of $100.10/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $105.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 5.06% if the stock gets called away at the June 18th expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $105.00 strike highlighted in red:
Considering the fact that the $105.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 94%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 0.17% boost of extra return to the investor, or 61.99% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example is 107%, while the implied volatility in the call contract example is 73%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $100.10) to be 57%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $105.00 strike highlighted in red: Considering the fact that the $105.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the June 18th expiration.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $105.00 strike highlighted in red: Considering the fact that the $105.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the June 18th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new June 18th contracts and identified one put and one call contract of particular interest.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $105.00 strike highlighted in red: Considering the fact that the $105.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the June 18th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new June 18th contracts and identified one put and one call contract of particular interest.
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At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new June 18th contracts and identified one put and one call contract of particular interest. Below is a chart showing DDOG's trailing twelve month trading history, with the $105.00 strike highlighted in red: Considering the fact that the $105.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options become available this week, for the June 18th expiration.
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2021-06-16 00:00:00 UTC
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Better Buy: Alphabet vs. Datadog
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DDOG
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https://www.nasdaq.com/articles/better-buy%3A-alphabet-vs.-datadog-2021-06-16
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Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Datadog (NASDAQ: DDOG) went in opposite directions over the past few months as the rotation from growth to value stocks rattled the tech sector. Alphabet's stock has risen nearly 40% since the beginning of 2021 as Google's advertising business recovered from the pandemic and its cloud business expanded. Its balance of growth and value, a quality that it shares with the other FAANG stocks, also shielded it from the sell-off in pricier tech stocks.
Datadog's stock has dipped about 3% this year, disappointing investors, who expected a continuation of its 160% rally in 2020. Like many other high-growth software stocks, Datadog's frothy valuations exposed it to the broader tech sell-off more than mature tech companies like Alphabet.
Image source: Getty Images.
Looking beyond this tumultuous year for tech stocks, will Alphabet remain the better investment? Or will Datadog resume its upward climb and outperform Google's parent company over the long term?
The differences between Alphabet and Datadog
Alphabet generated 80% of its revenue from Google's advertising platforms in 2020. This business struggled in the first half as companies bought fewer ads during the pandemic. The growth of Google Cloud, however, which benefited from the soaring usage of online services throughout the crisis, cushioned the blow. Its advertising business also recovered in the second half as the initial disruptions passed.
Datadog is a much smaller company, generating just $603.5 million in revenue in 2020 -- compared to Alphabet's $182.3 billion. Its platform enables IT professionals to monitor the performance of multiple servers, databases, cloud services, and mobile apps on unified dashboards.
This approach breaks down fragmented data silos across large companies and makes it much easier to diagnose problems. Demand for Datadog's services remained robust throughout the pandemic, since companies still needed to keep their online systems up and running.
How fast are Alphabet and Datadog growing?
Datadog is growing much faster than Alphabet, but that isn't surprising since it's a younger and smaller company.
REVENUE GROWTH (YOY)
FY 2019
FY 2020
Q1 2021
Alphabet
16%
11%
34%
Datadog
83%
66%
51%
Data source: Company reports. YOY =Year over year.
Alphabet's growth decelerated last year as the pandemic throttled its ad sales, but those headwinds subsequently waned. Meanwhile, Google Cloud continued growing with new and expanded partnerships with big companies like Ford and SAP. Analysts expect Alphabet's revenue to rise 30% this year.
Datadog's growth decelerated as it faced challenging year-over-year comparisons. However, it kept its net retention rate above 130% through the first quarter, which means its existing customers are still spending at least 30% more money on its services year over year.
Three-quarters of Datadog's customers were using two or more of its products in the first quarter, up from 63% a year ago, which indicates its ecosystem remains sticky and its "land and expand" approach is working.
Datadog also closed its acquisitions of the cloud security company Sqreen and the data visualization firm Timber last quarter. Those acquisitions will broaden Datadog's portfolio, but they also suggest it might rely more on acquisitions to keep growing. It expects its revenue to grow about 47% this year.
Valuations and profitability
Based on those estimates, Alphabet's stock trades at just seven times this year's sales. Datadog trades at 33 times this year's sales, which is a frothy price-to-sales ratio for a company with decelerating sales growth.
On the bottom line, Alphabet is consistently profitable by both GAAP and non-GAAP measures. Datadog is unprofitable on a GAAP basis but profitable on a non-GAAP basis, which excludes its stock-based compensation and other one-time expenses.
Alphabet's GAAP earnings rose 19% in 2020, and analysts expect 49% growth this year as its higher-margin ad business recovers. Those are impressive growth rates for a stock that trades at 26 times forward earnings.
Datadog posted its first non-GAAP profit in 2020 but expects that figure to decline roughly 34% this year as it integrates its recent acquisitions and ramps up its research and development (R&D) and marketing investments. That's a glum near-term outlook for a stock that trades at nearly 320 times forward earnings.
The winner: Alphabet
I admire Datadog's business, since its silo-busting platform is disruptive and saves IT professionals lots of time. But I don't believe its stock will outperform Alphabet's for the foreseeable future.
Datadog's stock has more than tripled since its public debut in late 2019 and is due for a breather. There's still too much growth baked into its stock, and investors will more likely focus on balanced growth stocks like Alphabet in this wobbly market.
Investors can still buy Datadog as a speculative long-term bet but shouldn't expect it to replicate its market-crushing gains from 2020 anytime soon.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of June 7, 2021
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Leo Sun has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and Datadog. The Motley Fool recommends SAP SE. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Datadog (NASDAQ: DDOG) went in opposite directions over the past few months as the rotation from growth to value stocks rattled the tech sector. Its platform enables IT professionals to monitor the performance of multiple servers, databases, cloud services, and mobile apps on unified dashboards. Three-quarters of Datadog's customers were using two or more of its products in the first quarter, up from 63% a year ago, which indicates its ecosystem remains sticky and its "land and expand" approach is working.
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Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Datadog (NASDAQ: DDOG) went in opposite directions over the past few months as the rotation from growth to value stocks rattled the tech sector. Alphabet's stock has risen nearly 40% since the beginning of 2021 as Google's advertising business recovered from the pandemic and its cloud business expanded. Alphabet's GAAP earnings rose 19% in 2020, and analysts expect 49% growth this year as its higher-margin ad business recovers.
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Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Datadog (NASDAQ: DDOG) went in opposite directions over the past few months as the rotation from growth to value stocks rattled the tech sector. There's still too much growth baked into its stock, and investors will more likely focus on balanced growth stocks like Alphabet in this wobbly market. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and Datadog.
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Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Datadog (NASDAQ: DDOG) went in opposite directions over the past few months as the rotation from growth to value stocks rattled the tech sector. It expects its revenue to grow about 47% this year. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.
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718852.0
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2021-06-14 00:00:00 UTC
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Big Data Stocks: What You Should Buy, What You Should Sell
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DDOG
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https://www.nasdaq.com/articles/big-data-stocks%3A-what-you-should-buy-what-you-should-sell-2021-06-14
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
This the latest in my weekly investing series focused on thematic Buy/Sell recommendations. Today, I’ll look at Big Data stocks. First, I’ll explain why you should buy New Relic (NYSE:NEWR) stock. After, I’ll take an even deeper dive into one of the Big Data companies you really should consider selling now.
Big Data Stocks to Buy: NEWR Stock
New Relic is a comeback kid in a hot market.
Specifically, at an accessible $4.2 billion market cap, New Relic is an early, small-cap play on a very big investment theme. The company, which makes monitoring software for IT networks, sits in a roughly $6 billion Application Performance Management (APM) market. This market is one of the fastest growers in networking, expected to grow 11% annually to over $11 billion by 2027.
The investment thesis behind Big Data stocks like NEWR stock is simple. IT environments are increasingly more complicated, and New Relic’s tools are powerful software troubleshooting and performance analytics platforms that look deep into applications for bugs and issues.
New Relic has struggled relative to its faster-growing and headline-grabbing competitor, Datadog (NASDAQ:DDOG). Datadog has posted impressive 66% revenue growth last year. In contrast, NEWR grew 11% in its most recent fiscal year (ended March). Much of New Relic’s growth stagnation was because the product was very difficult to comprehend, especially at a time when Datadog was stealing the limelight. But, over the past year, New Relic made important changes to its business model, which should allow it to re-capture market share from Datadog. Strong recent quarterly results show the tide is turning.
A new, sticky model and margin ramp should power NEWR stock.
In April, NEWR announced a change in its business from a license-based subscription model to a consumption-based model (pay for what you use). The theory is that by lowering costs upfront, customers will use the service more. Other consumption-based SaaS (software-as-a-service) companies like Twilio (NYSE:TWLO) and Snowflake (NYSE:SNOW) have done really well with this model. Furthermore, both companies generate above-industry growth and premium valuations (20x and 62x EV/sales, respectively).
NEWR’s valuation should also expand as the company demonstrates consistent growth from this new model. We’re already seeing evidence that it’s working. Last quarter (FQ4Mar), NEWR delivered a revenue beat and stronger revenue retention rates than the preceding two quarters. Existing customers are clearly getting more use out of a “stickier” product.
10 Best Stocks to Buy That Will Get You Through the Day
Not only is revenue growth accelerating. So too are profitability and cash flow. The business model shift temporarily dampened margins, but these are ramping back up. Its F2020 gross margin of 73% should expand to the company’s historical >80% over the next few quarters. NEWR is also profitable from a free cash flow and non-GAAP net income basis, which are strong standouts in a tech sector where investors seem less-focused on growth. All of these factors add up to make it a standout pick among Big Data stocks today.
New Relic stock is cheap while also being a potential acquisition target.
At approximately 5x forward sales, NEWR is a deep bargain in a software sector that has most stocks trading at double-digit revenue multiples. Numbers are moving in the right direction. Revenues and margins are expanding. There are several growth levers working to get the business back on track. A cloud-based business model, recurring revenue profile and free cash flow also make NEWR an attractive acquisition target in a sector that’s clearly consolidating. As reference, private equity firm Thoma Bravo announced an acquisition of data analytics peer Talend (NASDAQ:TLND) in March at approximately 6x revenues.
Several recent national cybersecurity threats have brought data analytics back into the spotlight as a critical area of IT infrastructure spending. They’ve also put plenty of other Big Data stocks back on the radar.
Big Data Stocks to Sell: Palantir Technologies
A closer look at the government sector’s “Batman.”
Palantir’s (NYSE:PLTR) Gotham software helps U.S. counterterrorism and military agencies collect, analyze and visualize vast amounts of disparate data. The company’s “Batman technology,” as it’s sometimes referred to on popular YouTube investing sites, mines massive data sets for intelligence and law enforcement applications.
Last quarter, Palantir posted 76% revenue growth in its government business, led by marquee customer U.S. Army, where it won an $823 million contract to develop a new intelligence platform. Palantir has worked with U.S. Customs and Border Protection to track immigrants and travelers at the border. It has helped locate Mexican drug cartel members. It has even tested secret policing technology in New Orleans. Since Palantir’s IPO in September 2020, PLTR stock has soared from $10 to as high as $39 in January. Shares now trade around $24.
PLTR’s revenue guidance calls for revenue growth of 30% or more for 2021 through 2025. However, to get to these ambitious projections, the company must successfully shift its business from the world of spies and special ops to corporate America.
The mask comes off in the enterprise.
Here’s where things get more complicated. While Palantir may be Batman to its government customers, the company is very human in the enterprise market. The Street has been concerned about the growth trajectory of the commercial business (39% of Q1 sales). Despite having landed some large marquee customers, commercial growth has been disappointing relative to government growth (19% growth last quarter).
Palantir’s path into the broader enterprise market, especially among smaller businesses, hasn’t gained traction. In theory, the same tools that can predict ambushes in Iraq can help companies analyze their own data. But in practice, privacy is a massive concern for corporate customers. The marriage of Big Data and Big Brother raises obvious red flags around more invasive implications of data-driven policing.
For now, Palantir is putting hefty resources into the healthcare side of its business. This is an industry where data privacy concerns run highest. Last month, the company hired Dr. Bill Kassler, formerly of IBM’s (NYSE:IBM) Watson Health, as its first U.S. government chief medical officer (CMO). The Food and Drug Administration, Centers for Disease Control and Prevention and National Institutes of Health are all Palantir customers. However, with overall top-line growth slowing, the company will face pressure to demonstrate broader traction here.
Special Purpose Acquisition Companies (SPACs): Bruce Wayne style investing in the commercial market.
While Palantir’s business is in data-analytics, the company has been getting more attention recently for its investments. Over the last three months, the company has invested in six SPACs:
Sarcos Robotics (robotics) – $21 million
Lilium (high speed air transportation)
Wejo (automotive sensors and data)
Celularity (biotechnology) – $20 million
Roivant Sciences (healthcare) – $30 million
Babylon (healthcare)
Palantir’s focus on SPAC investments is a bit unusual — for two reasons. First, these are investments in later-stage companies that already have billion-dollar-plus valuations. While other tech companies, including Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) Salesforce (NYSE:CRM) and Intel (NASDAQ:INTC) have large venture capital businesses, they tend to focus on early stage technology investments.
Second, Palantir’s SPAC investments are often packaged with customer contracts. Roivant Health signed a five-year subscription contract with Palantir. Celularity, Sarcos Robotics and Babylon Health, have all signed product deals with Palantir. On May 11, Palantir signed a deal to invest $20 million in the SPAC deal of an unnamed “mobility company” and the unnamed company signed a five-year subscription deal with Palantir. Kevin Kawasaki, Palantir’s head of business development, says these investments are opportunities to “back really good management teams with big visions.” But these investments also demonstrate that Palantir is effectively buying its way into large companies that can exploit its data tools.
Time will tell whether this strategy generates meaningful revenue growth.
PLTR stock has a rich valuation.
Palantir is trading at a whopping 116x forward EBITDA — well above the sector median of 17x. Given the strong recent run and rich premium, coupled with the potential for revenue deceleration, I expect shares to trade sideways from here. At these levels, there’s meaningful downside risk to the stock without a strong enterprise ramp and a re-acceleration of growth.
It’s best to put money to work elsewhere.
Your comments and feedback are always welcome. Let’s continue the discussion. Email me at jmakris@investorplace.com.
On the date of publication, Joanna Makris did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Joanna Makris is a Market Analyst at InvestorPlace.com. A strategic thinker and fundamental public equity investor, Joanna leverages over 20 years of experience on Wall Street covering various segments of the Technology, Media, and Telecom sectors at several global investment banks, including Mizuho Securities and Canaccord Genuity.
The post Big Data Stocks: What You Should Buy, What You Should Sell appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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New Relic has struggled relative to its faster-growing and headline-grabbing competitor, Datadog (NASDAQ:DDOG). As reference, private equity firm Thoma Bravo announced an acquisition of data analytics peer Talend (NASDAQ:TLND) in March at approximately 6x revenues. Last quarter, Palantir posted 76% revenue growth in its government business, led by marquee customer U.S. Army, where it won an $823 million contract to develop a new intelligence platform.
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New Relic has struggled relative to its faster-growing and headline-grabbing competitor, Datadog (NASDAQ:DDOG). Despite having landed some large marquee customers, commercial growth has been disappointing relative to government growth (19% growth last quarter). Over the last three months, the company has invested in six SPACs: Sarcos Robotics (robotics) – $21 million Lilium (high speed air transportation) Wejo (automotive sensors and data) Celularity (biotechnology) – $20 million Roivant Sciences (healthcare) – $30 million Babylon (healthcare) Palantir’s focus on SPAC investments is a bit unusual — for two reasons.
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New Relic has struggled relative to its faster-growing and headline-grabbing competitor, Datadog (NASDAQ:DDOG). Big Data Stocks to Sell: Palantir Technologies A closer look at the government sector’s “Batman.” Palantir’s (NYSE:PLTR) Gotham software helps U.S. counterterrorism and military agencies collect, analyze and visualize vast amounts of disparate data. On May 11, Palantir signed a deal to invest $20 million in the SPAC deal of an unnamed “mobility company” and the unnamed company signed a five-year subscription deal with Palantir.
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New Relic has struggled relative to its faster-growing and headline-grabbing competitor, Datadog (NASDAQ:DDOG). Big Data Stocks to Buy: NEWR Stock New Relic is a comeback kid in a hot market. The investment thesis behind Big Data stocks like NEWR stock is simple.
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2021-06-12 00:00:00 UTC
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3 Stocks That Should Heat Up This Summer
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DDOG
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https://www.nasdaq.com/articles/3-stocks-that-should-heat-up-this-summer-2021-06-12
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nan
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Temperatures are starting to heat up, and so are some of stocks that were cooling down after rallying earlier this year. Shares of Datadog (NASDAQ: DDOG), Bumble (NASDAQ: BMBL), and Zoom (NASDAQ: ZM) are some of the stocks making what should be sustainable moves right now.
Datadog, Bumble, and Zoom are all down at least 20% from their recent highs. Is this opportunity knocking for risk-tolerant growth investors? Let's go over why I believe these are three names that could heat up your portfolio this summer.
Image source: Getty Images.
1. Datadog
Cloud-computing stocks have been gray since peaking in February, but the skies are finally starting to clear. Datadog runs a monitoring and security platform for cloud applications, offering essential services to enterprises needing real-time visibility into uptime reports, analytics, and a growing number of features that Datadog keeps adding to beef up its ecosystem.
Business is booming. The number of large clients on pace to spend at least $100,000 a year with Datadog has climbed 50% over the past year. When you're on the Datadog platform you tend to stick around, lean on it more, and add new Datadog modules. Dollar-based net retention rate has clocked in above 130% for 15 consecutive quarters. In other words, existing customers are spending on average 30% more through Datadog than they were a year earlier.
Revenue growth has slowed over the years, decelerating to a still-impressive 51% year-over-year gain in its latest report. It was another "beat and raise" report. Datadog sees growth of 51% to 52% in the current quarter, and since it's historically been conservative with its crystal ball, it's fair to say that growth is accelerating again.
2. Bumble
Online dating slowed during the pandemic, but there aren't too many better plays for the reopening of the planet than Bumble. It operates two of four highest-grossing online dating apps in the world in its namesake app (second only in popularity to Tinder) and Badoo.
To be fair, Bumble didn't see its business shrink during the COVID-19 crisis. Revenue still rose 19% in 2020. However, with revenue climbing 31% in the fourth quarter of last year and 43% in its latest financial update momentum is clearly on the side of the bulls.
The appeal to Bumble's rise is that it only lets women initiate contact with a prospective match. The app was started by a Tinder co-founder that had a better mousetrap, and it's paying off so far in 2021. Revenue at Baidu rose 61%, now accounting for two-thirds of the revenue mix.
Investors haven't had a lot of time to warm up to Bumble. It hit the market at $43 four months ago, nearly doubling on its second day of trading before giving all of those gains back in the following weeks. You can get in now for just a little more than what IPO investors paid, and that should make your heart skip a beat.
3. Zoom
A little more than a year ago, we were all downloading Zoom as a way to stay connected with workmates, classmates, friends, and family. Zoom has been sliding as an investment since October when viable pandemic-tackling vaccines were inching closer to reality, but Zoom keeps growing.
Classrooms, businesses, and family reunions have returned to in-person gatherings, but we're still keeping Zoom active for situations when it's more convenient. Revenue keeps trouncing expectations, and Zoom is checking in with some ridiculous profit margins.
Zoom's revenue nearly tripled in its latest fiscal quarter, and the bottom line is growing even faster. Zoom's net profit margin is at a whopping 24%. Zoom's continuing ascent as a business and the stock's slide has rattled the multiples. Zoom was trading for 126 times trailing revenue at its peak in the fall of last year. Now it's fetching just 77 times this year's expected earnings. Yes, earnings. You didn't delete the Zoom app. The market was wrong to delete Zoom, and now it's starting to heat up again.
Find out why Zoom Video Communications is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
Tom and David just revealed their ten top stock picks for investors to buy right now. Zoom Video Communications is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of June 7, 2021
Rick Munarriz owns shares of Bumble, Datadog, and Zoom Video Communications. The Motley Fool owns shares of and recommends Datadog and Zoom Video Communications. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of Datadog (NASDAQ: DDOG), Bumble (NASDAQ: BMBL), and Zoom (NASDAQ: ZM) are some of the stocks making what should be sustainable moves right now. However, with revenue climbing 31% in the fourth quarter of last year and 43% in its latest financial update momentum is clearly on the side of the bulls. Find out why Zoom Video Communications is one of the 10 best stocks to buy now Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market.
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Shares of Datadog (NASDAQ: DDOG), Bumble (NASDAQ: BMBL), and Zoom (NASDAQ: ZM) are some of the stocks making what should be sustainable moves right now. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. *Stock Advisor returns as of June 7, 2021 Rick Munarriz owns shares of Bumble, Datadog, and Zoom Video Communications.
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Shares of Datadog (NASDAQ: DDOG), Bumble (NASDAQ: BMBL), and Zoom (NASDAQ: ZM) are some of the stocks making what should be sustainable moves right now. Find out why Zoom Video Communications is one of the 10 best stocks to buy now Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. *Stock Advisor returns as of June 7, 2021 Rick Munarriz owns shares of Bumble, Datadog, and Zoom Video Communications.
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Shares of Datadog (NASDAQ: DDOG), Bumble (NASDAQ: BMBL), and Zoom (NASDAQ: ZM) are some of the stocks making what should be sustainable moves right now. Revenue growth has slowed over the years, decelerating to a still-impressive 51% year-over-year gain in its latest report. Zoom was trading for 126 times trailing revenue at its peak in the fall of last year.
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48efee6d-a4ee-4b4d-abdd-011e67424606
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718854.0
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2021-06-08 00:00:00 UTC
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Good Stocks To Invest In Right Now? 3 Cybersecurity Stocks For Your Watchlist
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DDOG
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https://www.nasdaq.com/articles/good-stocks-to-invest-in-right-now-3-cybersecurity-stocks-for-your-watchlist-2021-06-08
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nan
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nan
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3 Top Cybersecurity Stocks To Watch Right Now
In a time where cyberattacks are increasingly devastating and costly, investors could be turning towards the top cybersecurity stocks. If anything, this part of the stock market has and continues to gain momentum as businesses go digital. While some are gradually returning to offices now, many companies across the globe are still operating remotely. From data breaches and ransomware attacks to even asset theft, organizations are more vulnerable than ever to digital threats. Because of all this, cybersecurity companies, and cybersecurity stocks by extension, would be in the spotlight.
For the most part, the surge in cyber crimes does line up with the recent wave of digital acceleration seen throughout the pandemic. Back in December 2020, the world was put on high alert following the catastrophic SolarWinds (NYSE: SWI) hack. Since then, ongoing investigations have revealed that a wide array of federal and private organizations were targeted. Fast forward half a year later and hackers appear to be targeting critical infrastructure now. Namely, the hacks on the Colonial Pipeline company and the JBS (OTCMKTS: JBSAY) company are the most recent examples. Just this week, U.S. authorities revealed that they were able to recover $2.3 million in Bitcoin paid as ransom in the Colonial Pipeline hack.
Indeed, as cybercriminals grow bolder, cybersecurity companies are also stepping up to the plate. Just last month, CrowdStrike (NASDAQ: CRWD) expanded on its existing partnership with Google’s (NASDAQ: GOOGL) cloud division. After introducing more security service integrations, they can now provide joint enterprise customers with greater threat visibility across cloud workloads. All in all, things appear to be heating up on the digital security front. For investors looking to bet on cybersecurity now, here are three companies to know in the stock market today.
Cybersecurity Stocks To Watch Right Now
Datadog Inc. (NASDAQ: DDOG)
Zscaler Inc. (NASDAQ: ZS)
Check Point Software Technologies Ltd (NASDAQ: CHKP)
Datadog Inc.
To begin with, we will be looking at Datadog. In brief, the company mainly operates via its proprietary monitoring and security platform for cloud applications. Datadog’s software-as-a-service (SaaS) platform provides a comprehensive and automated tech stack of monitoring functions. This includes infrastructure monitoring, application performance monitoring, and log management services. Notably, all of these components of its SaaS model work together to deliver unified, real-time observability to Datadog’s customers. The likes of which include organizations of all sizes and across various industries. Given its preventative cybersecurity offerings, companies would look to Datadog as a possible first line of defense now. In turn, I could see investors watching DDOG stock now because of this.
Source: TD Ameritrade TOS
Just last month, the company posted solid figures in its first-quarter fiscal. In particular, Datadog raked in total revenue of $198.5 million for the quarter, marking a 51% year-over-year jump. On top of that, the company also reported a 90% increase in cash on hand over the same time as well. Moving forward, CEO Olivier Pomel said, “Businesses are planning for a post-pandemic world. Digital transformation projects are being prioritized, as the need to be digital-first and agile is more prominent than ever. We believe we are in a strong position to benefit from this trend as the most complete and cloud-native end-to-end observability platform.” Given its healthy financial position and current momentum, Datadog appears to be kicking into high gear now.
On the operational front, the company remains hard at work as well. As of last month, the company is currently a launch partner with Amazon (NASDAQ: AMZN) Web Services (AWS). Specifically, Datadog’s platform now fully supports application monitoring with the AWS App Runner. Given all of this, would you consider DDOG stock worth investing in now?
Zscaler Inc.
Following that, we have IT security company Zscaler. The California-based company primarily works through its Zscaler Zero Trust Exchange (ZTE) platform. Simply put, ZTE connects users directly to company applications, providing fast and secure experiences. With the ZTE platform, the company also protects thousands of customers from cyberattacks and data loss regardless of location. For a sense of scale, Zscaler’s platform is distributed across 150 data centers worldwide. According to the company, this would make Zscaler ZTE the world’s largest in-line cloud security platform. Despite all of this, ZS stock has mostly been trading sideways this year. Could it be worth jumping on now?
Source: TD Ameritrade TOS
Well, for one thing, the company continues to bolster its services amidst these critical times. As of late May, Zscaler is in a definitive agreement to acquire Smokescreen Technologies, an active defense and deception tech firm. In detail, Smokescreen’s tech will be integrated into the Zscaler’s ZTE platform. Ideally, this would further expand the precision of the company’s detection software, making it more sensitive to sophisticated cyberattacks. If that wasn’t enough, Smokescreen’s tech will also provide “threat intelligence” and telemetry for the Zscaler team to proactively scan for possible breaches.
In terms of finances, Zscaler also reported its recent quarter fiscal at the end of May. To point out, the company posted quarterly revenue of $176.4 million. This adds up to a solid 59% year-over-year increase. Moreover, the company also saw its calculated billings surge by 71% over the same period. With Zscaler raising its fiscal year guidance, would you say that now is a good time to buy ZS stock?
[Read More] 4 Semiconductor Stocks To Watch Right Now
Check Point Software Technologies Ltd
Another name to know in the cybersecurity space now would be Check Point Software Technologies (CHKP). Similar to our previous entries, the company is a leading provider of cybersecurity solutions now. More importantly, the key difference is its government clientele. Through its Infinity portfolio of solutions, the company protects public and private organizations from cyberthreats with industry-leading malware elimination software.
Source: TD Ameritrade TOS
While CHKP stock has not been among the most active stocks, CHKP does not seem to be slowing down. To highlight, the company recently received recognition from tech giant Microsoft (NASDAQ: MSFT). Particularly, CHKP received the Microsoft Security 20/20 award for the Most Transformative Integration Partner. No doubt, this recognition among global contenders would demonstrate CHKP’s excellence in the field. According to CHKP head of cloud, Erez Yarkoni, the duo provides “one of the most advanced threat prevention solutions” to Microsoft Azure customers.
Back in April, the company saw green across the board in its first-quarter fiscal as well. In it, CHKP posted total revenue of $507.6 million with earnings per share of $1.33. CEO Gil Shwed highlighted the increasingly dangerous cyber threat landscape as a key growth driver moving forward. Shwed also mentioned that CHKP’s Infinity architecture would address the need for comprehensive cybersecurity measures during the current “cyber pandemic”. Having read all this, will you be adding CHKP stock to your portfolio this week?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Cybersecurity Stocks To Watch Right Now Datadog Inc. (NASDAQ: DDOG) Zscaler Inc. (NASDAQ: ZS) Check Point Software Technologies Ltd (NASDAQ: CHKP) Datadog Inc. To begin with, we will be looking at Datadog. In turn, I could see investors watching DDOG stock now because of this. Given all of this, would you consider DDOG stock worth investing in now?
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Cybersecurity Stocks To Watch Right Now Datadog Inc. (NASDAQ: DDOG) Zscaler Inc. (NASDAQ: ZS) Check Point Software Technologies Ltd (NASDAQ: CHKP) Datadog Inc. To begin with, we will be looking at Datadog. In turn, I could see investors watching DDOG stock now because of this. Given all of this, would you consider DDOG stock worth investing in now?
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Cybersecurity Stocks To Watch Right Now Datadog Inc. (NASDAQ: DDOG) Zscaler Inc. (NASDAQ: ZS) Check Point Software Technologies Ltd (NASDAQ: CHKP) Datadog Inc. To begin with, we will be looking at Datadog. In turn, I could see investors watching DDOG stock now because of this. Given all of this, would you consider DDOG stock worth investing in now?
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Cybersecurity Stocks To Watch Right Now Datadog Inc. (NASDAQ: DDOG) Zscaler Inc. (NASDAQ: ZS) Check Point Software Technologies Ltd (NASDAQ: CHKP) Datadog Inc. To begin with, we will be looking at Datadog. In turn, I could see investors watching DDOG stock now because of this. Given all of this, would you consider DDOG stock worth investing in now?
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55934928-ff90-4f46-a46c-e244ee0bc90f
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718855.0
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2021-06-06 00:00:00 UTC
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DataDog Is Building a Huge Moat With Its Sticky Ecosystem
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DDOG
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https://www.nasdaq.com/articles/datadog-is-building-a-huge-moat-with-its-sticky-ecosystem-2021-06-06
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nan
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nan
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Investors love companies with moats. A business moat acts exactly the same way a castle moat does. It makes the business/castle harder to attack. On a Fool Live episode recorded on May 12, Fool contributor Brian Stoffel discusses the cloud monitoring specialist Datadog (NASDAQ: DDOG) and explains how investors can tell that this company is building an impressive moat.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of May 11, 2021
Brian Stoffel: Next on the list is Datadog. For those unfamiliar, Datadog makes a whole suite of products that help development and operations team monitor basically their digital assets. Let's make it super simple, like let's you monitor how your apps and your website is performing and a lot more than that. They announced earnings and when they did, they announced that revenue was up 52 percent, total customers that they have signed on for at least one of their products was up 32 percent to 15,000, and free cash flow more than doubled.
But here are the three metrics that I think are really important, and I apologize I had a time for not making a visual of this because I think hearing me just saying numbers is one thing, actually seeing it can drive it home, and I didn't have time to do this. But the number of customers that are paying Datadog at least $100,000 a year was up 50 percent. Obviously, the pandemic, the fact that we're comparing to a period of time that was right when it started juice those results.
But this is what matters the most, Datadog had one tool that you could use four or five years ago, one. Today, they've got 10 and they are working on more. The number of customers Datadog has that were using at least two of those tools was up 57 percent from the same time last year. The number of customers using at least four of the tools almost tripled.
Here's why that's so important. The more tools you add, the harder it is to leave. The more tools that are added, the more evidence it is that Datadog has optionality, which means that they have many ways to fulfill their mission and their unofficial mission statement that the two founders have is to "restore sanity to the development and operation side of companies." There are lots of ways to restore sanity. I think it was a really very positive earnings report.
Brian Stoffel owns shares of Datadog. Brian Withers owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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On a Fool Live episode recorded on May 12, Fool contributor Brian Stoffel discusses the cloud monitoring specialist Datadog (NASDAQ: DDOG) and explains how investors can tell that this company is building an impressive moat. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them!
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On a Fool Live episode recorded on May 12, Fool contributor Brian Stoffel discusses the cloud monitoring specialist Datadog (NASDAQ: DDOG) and explains how investors can tell that this company is building an impressive moat. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. Brian Stoffel owns shares of Datadog.
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On a Fool Live episode recorded on May 12, Fool contributor Brian Stoffel discusses the cloud monitoring specialist Datadog (NASDAQ: DDOG) and explains how investors can tell that this company is building an impressive moat. See the 10 stocks *Stock Advisor returns as of May 11, 2021 Brian Stoffel: Next on the list is Datadog. The number of customers Datadog has that were using at least two of those tools was up 57 percent from the same time last year.
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On a Fool Live episode recorded on May 12, Fool contributor Brian Stoffel discusses the cloud monitoring specialist Datadog (NASDAQ: DDOG) and explains how investors can tell that this company is building an impressive moat. See the 10 stocks *Stock Advisor returns as of May 11, 2021 Brian Stoffel: Next on the list is Datadog. The number of customers Datadog has that were using at least two of those tools was up 57 percent from the same time last year.
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86d59398-d1dc-4c3e-99eb-9761d8775542
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718856.0
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2021-06-02 00:00:00 UTC
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Should You Buy Snowflake Stock Now?
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DDOG
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https://www.nasdaq.com/articles/should-you-buy-snowflake-stock-now-2021-06-03
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nan
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nan
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Since its IPO, Snowflake (NYSE: SNOW) stock rallied to $429 before crashing below $200. Its IPO made it a blockbuster unicorn stock for 2020, but is it a buy in 2021?
Snowflake offers a cloud-based data storage and analytics service, generally termed "data warehouse-as-a-service". It allows corporate users to store and analyze data using cloud-based hardware and software. Snowflake is technically not a Software-As-A-Service (SaaS) stock. 93% of its revenue is consumption-based. Snowflake provides a data warehouse-as-a-service or database-as-a-service (DaaS) that claims to dramatically simplify concurrency, performance, and overhead challenges, offering both reduced cost and improved agility.
It doesn't hurt that Snowflake is a Berkshire Hathaway-backed company. It works with Apple, Nike, Mastercard, Datadog, Walgreens, and many others. It has 75+ large, strategic accounts working toward migration and has been adding Fortune 500 customers at a rapid clip.
Can Snowflake stock help boost your stock market portfolio gains?
10 stocks we like better than Snowflake Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Snowflake Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of May 11, 2021
Eric Cuka owns shares of Apple, Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool recommends the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2023 $200 puts on Berkshire Hathaway (B shares), short June 2021 $240 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Snowflake provides a data warehouse-as-a-service or database-as-a-service (DaaS) that claims to dramatically simplify concurrency, performance, and overhead challenges, offering both reduced cost and improved agility. It has 75+ large, strategic accounts working toward migration and has been adding Fortune 500 customers at a rapid clip. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Snowflake Inc. wasn't one of them!
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See the 10 stocks *Stock Advisor returns as of May 11, 2021 Eric Cuka owns shares of Apple, Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool recommends the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2023 $200 puts on Berkshire Hathaway (B shares), short June 2021 $240 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple.
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See the 10 stocks *Stock Advisor returns as of May 11, 2021 Eric Cuka owns shares of Apple, Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), Datadog, Mastercard, Nike, and Snowflake Inc. The Motley Fool recommends the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2023 $200 puts on Berkshire Hathaway (B shares), short June 2021 $240 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple.
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10 stocks we like better than Snowflake Inc. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Snowflake Inc. wasn't one of them! The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), Datadog, Mastercard, Nike, and Snowflake Inc.
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93bdc4ae-e69c-4377-b9d5-3765b64ccccf
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718857.0
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2021-05-29 00:00:00 UTC
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If You Had Bought Datadog (NASDAQ:DDOG) Stock A Year Ago, You Could Pocket A 28% Gain Today
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DDOG
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https://www.nasdaq.com/articles/if-you-had-bought-datadog-nasdaq%3Addog-stock-a-year-ago-you-could-pocket-a-28-gain-today
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nan
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nan
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There's no doubt that investing in the stock market is a truly brilliant way to build wealth. But not every stock you buy will perform as well as the overall market. For example, the Datadog, Inc. (NASDAQ:DDOG), share price is up over the last year, but its gain of 28% trails the market return. Note that businesses generally develop over the long term, so the returns over the last year might not reflect a long term trend.
Datadog wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Datadog grew its revenue by 58% last year. That's stonking growth even when compared to other loss-making stocks. Let's face it the 28% share price gain in that time is underwhelming compared to the growth. It could be that the market is missing what growth investor Matt Joass calls 'the hidden power of inflection points'. It's possible that the market is worried about the losses, or simply that the growth was already priced in. Or, this could be worth adding to your watchlist.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
NasdaqGS:DDOG Earnings and Revenue Growth May 29th 2021
Datadog is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
We're happy to report that Datadog are up 28% over the year. While it's always nice to make a profit on the stock market, we do note that the TSR was no better than the broader market return of about 45%. The stock trailed the market by 11% in that time, testament to the power of passive investing. It might be that investors are more concerned about the business lately due to some fundamental change (or else the share price simply got ahead of itself, previously). I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 3 warning signs for Datadog you should be aware of.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For example, the Datadog, Inc. (NASDAQ:DDOG), share price is up over the last year, but its gain of 28% trails the market return. NasdaqGS:DDOG Earnings and Revenue Growth May 29th 2021 Datadog is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
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For example, the Datadog, Inc. (NASDAQ:DDOG), share price is up over the last year, but its gain of 28% trails the market return. NasdaqGS:DDOG Earnings and Revenue Growth May 29th 2021 Datadog is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. Note that businesses generally develop over the long term, so the returns over the last year might not reflect a long term trend.
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For example, the Datadog, Inc. (NASDAQ:DDOG), share price is up over the last year, but its gain of 28% trails the market return. NasdaqGS:DDOG Earnings and Revenue Growth May 29th 2021 Datadog is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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For example, the Datadog, Inc. (NASDAQ:DDOG), share price is up over the last year, but its gain of 28% trails the market return. NasdaqGS:DDOG Earnings and Revenue Growth May 29th 2021 Datadog is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. But not every stock you buy will perform as well as the overall market.
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78ae9eea-a9b1-4cc1-a761-0e6d72189529
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718858.0
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2021-05-23 00:00:00 UTC
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Investors Should Check Out This Cloud Computing Stock That's Down More Than 25%
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DDOG
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https://www.nasdaq.com/articles/investors-should-check-out-this-cloud-computing-stock-thats-down-more-than-25-2021-05-23
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nan
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nan
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As corporate computing infrastructures become more complex, it's important for information technology teams to keep tabs on how their tech stack is performing. Datadog (NASDAQ: DDOG) was founded to make this easier by helping its customers observe and monitor all facets of their network and every application users need. The stock has more than doubled since the company went public in September 2019, but shares have pulled back with the tech sell-off in the market. Even with shares off double digits from their recent high, Fool contributor Brian Withers explains why this cloud specialist is worth a look on a Fool Live episode that was recorded on May 13.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of May 11, 2021
Brian Withers: I'm going to talk about Datadog. I really like this company. It's set up for the future in the cloud. If you don't know what Datadog does, it has a set of what it calls observability tools, which allow information technology teams to observe or look into their applications, their network, their logs. If you're not familiar with software, it creates a bunch of logs, which are just dumps of huge amounts of data. What Datadog does is pull all the stuff together in a semblance where you can look at it all on one pane of glass.
What happens over time is networks are getting more complicated and applications. Companies may have stuff that they host on-premise in their own data center that has been around for a while, some Oracle. I remember when I was in corporate, we had an Oracle instance to run our manufacturing business, and that was hosted on site. But then there's all these cloud platforms that are hosted somewhere else, on Azure, AWS, whatnot. More and more companies are getting into this hybrid environment, where it's almost users can be anywhere and the software can be anywhere. It's really important for companies that depend on their websites being available for customers, which is just about everybody nowadays.
Datadog is really helpful in pulling things together. In fact, they shared one customer this past quarter who took eight different observability tools they were using, and they centralized, consolidated down to just Datadog.
Some of the numbers are just really impressive if you look at the most recent quarter, 51% top-line revenue change. I really like how they're having customers land and then expand. They have a bunch of different products. Customers spending $100,000 or more make up a majority of their annual recurring revenue, about 75% and it's growing at a healthy 50% a year. They have about 1,400 customers that are spending more than $100,000 a year.
Their remaining performance obligations, the sum of all the contracts together, and how long they are, and the monthly fees, and whatnot, that's grown 81% year over year. To me, what that says is, since that's growing faster than revenue, customers are signing up for bigger contracts and potentially longer contracts. That really bodes well for the future of this company.
I talked about the products being a land-and-expand model. At the end of the first quarter, 75% of all their customers were using more than one product, which is up from 63% last year, and those using four or more doubled to 25%.
This company has got an addressable market of about $35 billion that it shared in its filing to go public. But this monitoring and observability stuff is really just getting started.
To me, I'm still really super positive about this company. The only thing that's changed for me is the stock price. If you haven't taken a look at this one, maybe it's time you did.
Brian Withers owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG) was founded to make this easier by helping its customers observe and monitor all facets of their network and every application users need. As corporate computing infrastructures become more complex, it's important for information technology teams to keep tabs on how their tech stack is performing. The stock has more than doubled since the company went public in September 2019, but shares have pulled back with the tech sell-off in the market.
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Datadog (NASDAQ: DDOG) was founded to make this easier by helping its customers observe and monitor all facets of their network and every application users need. As corporate computing infrastructures become more complex, it's important for information technology teams to keep tabs on how their tech stack is performing. If you don't know what Datadog does, it has a set of what it calls observability tools, which allow information technology teams to observe or look into their applications, their network, their logs.
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Datadog (NASDAQ: DDOG) was founded to make this easier by helping its customers observe and monitor all facets of their network and every application users need. See the 10 stocks *Stock Advisor returns as of May 11, 2021 Brian Withers: I'm going to talk about Datadog. If you don't know what Datadog does, it has a set of what it calls observability tools, which allow information technology teams to observe or look into their applications, their network, their logs.
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Datadog (NASDAQ: DDOG) was founded to make this easier by helping its customers observe and monitor all facets of their network and every application users need. I really like this company. If you don't know what Datadog does, it has a set of what it calls observability tools, which allow information technology teams to observe or look into their applications, their network, their logs.
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3e63d1d0-72e9-409a-82d6-2cb38f8f99ae
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718859.0
|
2021-05-19 00:00:00 UTC
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Notable Wednesday Option Activity: LMT, MTOR, DDOG
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DDOG
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https://www.nasdaq.com/articles/notable-wednesday-option-activity%3A-lmt-mtor-ddog-2021-05-19
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nan
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nan
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Lockheed Martin Corp (Symbol: LMT), where a total of 5,533 contracts have traded so far, representing approximately 553,300 underlying shares. That amounts to about 43.3% of LMT's average daily trading volume over the past month of 1.3 million shares. Particularly high volume was seen for the $380 strike put option expiring June 18, 2021, with 433 contracts trading so far today, representing approximately 43,300 underlying shares of LMT. Below is a chart showing LMT's trailing twelve month trading history, with the $380 strike highlighted in orange:
Meritor Inc (Symbol: MTOR) options are showing a volume of 2,312 contracts thus far today. That number of contracts represents approximately 231,200 underlying shares, working out to a sizeable 43.1% of MTOR's average daily trading volume over the past month, of 535,940 shares. Particularly high volume was seen for the $30 strike call option expiring November 19, 2021, with 1,266 contracts trading so far today, representing approximately 126,600 underlying shares of MTOR. Below is a chart showing MTOR's trailing twelve month trading history, with the $30 strike highlighted in orange:
And Datadog Inc (Symbol: DDOG) options are showing a volume of 15,216 contracts thus far today. That number of contracts represents approximately 1.5 million underlying shares, working out to a sizeable 43.1% of DDOG's average daily trading volume over the past month, of 3.5 million shares. Especially high volume was seen for the $85 strike call option expiring May 21, 2021, with 2,950 contracts trading so far today, representing approximately 295,000 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange:
For the various different available expirations for LMT options, MTOR options, or DDOG options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $85 strike call option expiring May 21, 2021, with 2,950 contracts trading so far today, representing approximately 295,000 underlying shares of DDOG. Below is a chart showing MTOR's trailing twelve month trading history, with the $30 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 15,216 contracts thus far today. That number of contracts represents approximately 1.5 million underlying shares, working out to a sizeable 43.1% of DDOG's average daily trading volume over the past month, of 3.5 million shares.
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Below is a chart showing MTOR's trailing twelve month trading history, with the $30 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 15,216 contracts thus far today. That number of contracts represents approximately 1.5 million underlying shares, working out to a sizeable 43.1% of DDOG's average daily trading volume over the past month, of 3.5 million shares. Especially high volume was seen for the $85 strike call option expiring May 21, 2021, with 2,950 contracts trading so far today, representing approximately 295,000 underlying shares of DDOG.
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Especially high volume was seen for the $85 strike call option expiring May 21, 2021, with 2,950 contracts trading so far today, representing approximately 295,000 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange: For the various different available expirations for LMT options, MTOR options, or DDOG options, visit StockOptionsChannel.com. Below is a chart showing MTOR's trailing twelve month trading history, with the $30 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 15,216 contracts thus far today.
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Especially high volume was seen for the $85 strike call option expiring May 21, 2021, with 2,950 contracts trading so far today, representing approximately 295,000 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange: For the various different available expirations for LMT options, MTOR options, or DDOG options, visit StockOptionsChannel.com. Below is a chart showing MTOR's trailing twelve month trading history, with the $30 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 15,216 contracts thus far today.
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45aed9cf-85e6-4b1c-9e56-aa291b01eaf9
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718860.0
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2021-05-18 00:00:00 UTC
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Is Datadog Stock a Buy?
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DDOG
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https://www.nasdaq.com/articles/is-datadog-stock-a-buy-2021-05-18
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nan
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nan
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Beyond its better-than-expected first-quarter results, Datadog (NASDAQ: DDOG) is poised to benefit from the secular shift to cloud computing. Yet because of the recent tech sell-off, the stock has dropped by more than 30% from its February all-time high. So should investors take this opportunity to consider buying Datadog stock?
Flawless execution
Thanks to its unified and easy-to-use observability platform that provides deep monitoring of modern cloud infrastructures and applications, Datadog has been generating strong revenue growth over the last several years, and the first quarter was no exception.
Revenue increased by 51% year over year to $199 million, way above the guidance range of $185 million to $187 million. And given its confidence in the company's business, management raised its full-year revenue forecast to the range of $880 million to $890 million, which corresponds to impressive year-over-year growth of 47%.
Image source: Getty Images.
In particular, Datadog is firing on all cylinders with its land-and-expand strategy. The number of customers rapidly increased to 15,200 during the last quarter, up from 11,500 in the prior-year quarter. And with its consumption-based model, the company has been growing its top line as customers have been increasing their consumption of services.
Indeed, Datadog has been expanding its footprint beyond its core observability solutions to boost its business. For instance, it developed cybersecurity features last year. And following its acquisition of Sqreen in April, it will enhance its offerings for developers with extra application security capabilities.
Management showed strong execution with that strategy, as 25% of customers adopted four or more modules during the last quarter, up from 12% one year ago.
An opportunity?
Unsurprisingly, given Datadog's spectacular results, the stock doesn't seem cheap, even after having dropped by more than 30% from its February all-time high. It's trading at an elevated forward price-to-sales ratio of 27, which suggests the market expects the company to keep delivering phenomenal results over many years.
Granted, with its solid execution amid the secular shift to cloud computing, Datadog should keep generating strong growth for the foreseeable future. But that growth is likely to decelerate, as many players have been ramping up their efforts to develop competitive observability offerings.
For instance, the legacy application monitoring vendor New Relic (NYSE: NEWR) released its new unified observability platform New Relic One in August. It has been migrating its existing customers to that new platform to encourage the consumption of extra services, and it gave up its subscription-based business to adopt Datadog's usage-based model. During itsearnings calllast Thursday, the company confirmed its push in the observability area.
Also, the legacy log monitoring specialist Splunk (NASDAQ: SPLK) revealed at the beginning of this month its new observability cloud platform. That announcement isn't surprising as the company has been expanding its core on-premises log monitoring capabilities to a more comprehensive cloud-based offering over the last few years. But this confirms the competitive landscape in Datadog's markets is becoming more and more crowded.
Large tech players have shown a strong interest in Datadog's markets as well. Following its acquisition of the application monitoring specialist AppDynamics in 2017, the networking giant Cisco Systems developed a complete observability platform. Also, at the end of last year, the database giant Oracle announced its new cloud observability and management solution, and in the scope of its transition to the cloud, IBM acquired the observability player Instana.
Thus, despite the recent tech sell-off that sent Datadog's stock much lower, I'd rather stay on the sidelines. The market is already pricing in strong future performance amid intensifying competition, which represents a risky investment that offers modest upside potential and limited downside protection.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Herve Blandin owns shares of Cisco Systems and IBM. The Motley Fool owns shares of and recommends Datadog and Splunk. The Motley Fool recommends New Relic. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Beyond its better-than-expected first-quarter results, Datadog (NASDAQ: DDOG) is poised to benefit from the secular shift to cloud computing. Flawless execution Thanks to its unified and easy-to-use observability platform that provides deep monitoring of modern cloud infrastructures and applications, Datadog has been generating strong revenue growth over the last several years, and the first quarter was no exception. It has been migrating its existing customers to that new platform to encourage the consumption of extra services, and it gave up its subscription-based business to adopt Datadog's usage-based model.
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Beyond its better-than-expected first-quarter results, Datadog (NASDAQ: DDOG) is poised to benefit from the secular shift to cloud computing. Flawless execution Thanks to its unified and easy-to-use observability platform that provides deep monitoring of modern cloud infrastructures and applications, Datadog has been generating strong revenue growth over the last several years, and the first quarter was no exception. Granted, with its solid execution amid the secular shift to cloud computing, Datadog should keep generating strong growth for the foreseeable future.
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Beyond its better-than-expected first-quarter results, Datadog (NASDAQ: DDOG) is poised to benefit from the secular shift to cloud computing. Flawless execution Thanks to its unified and easy-to-use observability platform that provides deep monitoring of modern cloud infrastructures and applications, Datadog has been generating strong revenue growth over the last several years, and the first quarter was no exception. Also, at the end of last year, the database giant Oracle announced its new cloud observability and management solution, and in the scope of its transition to the cloud, IBM acquired the observability player Instana.
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Beyond its better-than-expected first-quarter results, Datadog (NASDAQ: DDOG) is poised to benefit from the secular shift to cloud computing. Management showed strong execution with that strategy, as 25% of customers adopted four or more modules during the last quarter, up from 12% one year ago. But that growth is likely to decelerate, as many players have been ramping up their efforts to develop competitive observability offerings.
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71b96d48-261d-4b7d-886e-95d9accbdf98
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718861.0
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2021-05-16 00:00:00 UTC
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SaaS Stocks Are Down Huge: These 3 Companies Are Starting to Look Cheap
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DDOG
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https://www.nasdaq.com/articles/saas-stocks-are-down-huge%3A-these-3-companies-are-starting-to-look-cheap-2021-05-16
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nan
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nan
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Software-as-a-service (SAAS) stocks have taken a big hit since the beginning of this year. Many investors have fled technology stocks as they look for other investments that they believe will grow as the U.S. economy begins to open back up.
That shift from tech stocks has left some significant buying opportunities for investors who know that buying and holding great companies is the way to build wealth. To help you find some SaaS stocks that look cheap right now we asked a few Motley Fool contributors for some ideas. They came back with Zoom Video Communications (NASDAQ: ZM), DataDog (NASDAQ: DDOG), and The Trade Desk (NASDAQ: TTD). Here's why.
Image source: Getty Images.
Video users keep rising, the stock keeps falling
Nicholas Rossolillo (Zoom Video Communications): Zoom stock's incredible run has come to an end, at least for now. After running up by more than 700% from January to October 2020, the stock is now up "only" 300% since the start of 2021. To be fair, the valuation was getting a little out of hand last autumn. But as the economy gradually reopens, investor worry has mounted that the company's fast-growing global user base could stall out or even reverse course. So far, nothing could be further from the truth.
After revenue and free cash flow skyrocketed 326% and 1,120% respectively in fiscal 2021 (the 12 months ended Jan. 31, 2020), management is forecasting another 42% jump in sales on top of that in the next year. Clearly, the more than 467,000 business customers with at least 10 employees aren't planning on parting ways with Zoom anytime soon. On the contrary, use of the cloud video communications service is expected to deepen even as effects from COVID-19 ease.
Sometimes it takes a highly destructive event like a pandemic to wake many of us up to the benefits of technology. Zoom was growing before 2020 happened, but it became a household name overnight when lockdowns started. While no one would wish for it to happen again, these lockdowns revealed how useful Zoom is -- especially in business. There was a lot of unnecessary travel and commuting going on, and Zoom is unlocking more efficiency for companies that have embraced video calls.
All of this is to say shares are beginning to look like a long-term value again. As of this writing, shares trade for about 60 times trailing-12-month free cash flow (the cheapest it's ever been as Zoom's profits have soared) and 22 times management's revenue forecast for the next year. That's far cheaper than the 35 times one-year forward sales Zoom was trading for right before the start of the pandemic last March, even though this is an enduring high-growth story. With business communications permanently altered in the last year, Zoom is in pole position in the cloud video industry and poised to continue benefiting for the foreseeable future.
Image source: Getty Images.
DataDog is just getting started
Brian Withers (DataDog): DataDog stock is seemingly in freefall, dropping more than 30% off its high from earlier this year. But the underlying business is stronger than ever. Let's take a look at the most recent results and why you might look at dipping your toe into this monitoring-as-a-service software specialist.
Its first-quarter revenue growth hit the high end of management's expectations, coming in at 51% year-over-year on top of 87% year-over-year growth the previous Q1. The company attributed existing customer usage growth, higher-than-expected annual recurring revenue from new customer contracts, and continued low churn for the outperformance. Its top line hit a record $199 million, but that's not what was most exciting. The company added about 1,000 customers in the quarter bringing the total to around 15,200 and its customers are spending more than ever. Clients that spend $100,000 or more annually make up 75% of the annual recurring revenue (ARR) and are growing at a strong 50% year-over-year rate. With the dollar-based net retention continuing above 130%, its existing customers are a substantial source of ongoing growth.
METRIC
Q1 2020
Q4 2020
Q1 2021
CHANGE (QOQ)
CHANGE (YOY)
Revenue
$131 million
$178 million
$199 million
8%
51%
>$100K ARR customers
960
1,253
1,437
15%
50%
Remaining performance obligations
$256 million
$434 million
$464 million
7%
81%
Data source: DataDog earnings reports and earnings calls. QOQ = quarter over quarter. YOY = year over year.
The company's products are popular with customers. At the end of Q1, 75% of all customers are using more than one monitoring product, which is up from 63% last year. The number using four or more more than doubled to 25%, up from 12% a year ago. This quarter it reported notable customer wins in a variety of industries including consulting, grocery, and financial services. Its broad set of offerings is helping customers make monitoring its information technology simpler and more powerful. This quarter, EVA, an online gaming company, went from using eight different observability tools to standardizing on DataDog's single platform for all its monitoring needs.
Lastly, the strong 81% growth in remaining performance obligations shows that customers are signing larger and lengthier contracts. All of this points to a bright future for this lead dog.
With an addressable market of $35 billion, this monitoring and observability platform is just getting started. But even with the latest drop in the stock, value investors may be scared off by the still lofty 35 price-to-sales ratio. For tech investors with a view that businesses will continue to move to cloud-based services, this (Data)dog could become investors' best friend over the next decade.
Image source: Getty Images.
This advertising platform stock is hugely discounted right now
Chris Neiger (The Trade Desk): Investors looking for a great SaaS stock that looks like a screaming buy right now should consider The Trade Desk. If you're unfamiliar with what the company does, Trade Desk's advertising platform helps companies deliver ads across the internet, mobile devices, and connected TVs.
In The Trade Desk's first quarter (reported on May 10) the company's revenue rose 37% year over year to $219.8 million and its adjusted diluted earnings of $1.41 blew past Wall Street's consensus estimate of $0.77 per share.
But investors were unimpressed. Some analysts think investors may have been looking for a bigger earnings beat than the company delivered, but no matter what the reason the company's share price tumbled following the quarterly report and now The Trade Desk's stock is down 37% year to date.
Here's the important part: There's nothing fundamentally wrong with The Trade Desk's business that should cause investors to push the company's share price down so much. In fact, the company is successfully tapping into the connected TV advertising market, which is expected to double in size between 2020 and 2024.
The Trade Desk still has a customer retention rate above 95% and its advertising platform is benefiting from a growing shift of advertising dollars from traditional TV to connected TV platforms.
Despite the massive share price drop this year The Trade Desk's stock is still up 70% over the past 12 months. And once investors come to their senses and recognize that The Trade Desk's business is as healthy as ever, it's likely that this SaaS stock will climb even higher.
Find out why The Trade Desk is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
Tom and David just revealed their ten top stock picks for investors to buy right now. The Trade Desk is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of May 11, 2021
Brian Withers owns shares of Datadog, The Trade Desk, and Zoom Video Communications. Chris Neiger has no position in any of the stocks mentioned. Nicholas Rossolillo owns shares of The Trade Desk and Zoom Video Communications. The Motley Fool owns shares of and recommends Datadog, The Trade Desk, and Zoom Video Communications. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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They came back with Zoom Video Communications (NASDAQ: ZM), DataDog (NASDAQ: DDOG), and The Trade Desk (NASDAQ: TTD). After revenue and free cash flow skyrocketed 326% and 1,120% respectively in fiscal 2021 (the 12 months ended Jan. 31, 2020), management is forecasting another 42% jump in sales on top of that in the next year. With business communications permanently altered in the last year, Zoom is in pole position in the cloud video industry and poised to continue benefiting for the foreseeable future.
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They came back with Zoom Video Communications (NASDAQ: ZM), DataDog (NASDAQ: DDOG), and The Trade Desk (NASDAQ: TTD). Revenue $131 million $178 million $199 million 8% 51% >$100K ARR customers 960 1,253 1,437 15% 50% Remaining performance obligations $256 million $434 million $464 million 7% 81% Data source: DataDog earnings reports and earnings calls. If you're unfamiliar with what the company does, Trade Desk's advertising platform helps companies deliver ads across the internet, mobile devices, and connected TVs.
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They came back with Zoom Video Communications (NASDAQ: ZM), DataDog (NASDAQ: DDOG), and The Trade Desk (NASDAQ: TTD). This advertising platform stock is hugely discounted right now Chris Neiger (The Trade Desk): Investors looking for a great SaaS stock that looks like a screaming buy right now should consider The Trade Desk. In The Trade Desk's first quarter (reported on May 10) the company's revenue rose 37% year over year to $219.8 million and its adjusted diluted earnings of $1.41 blew past Wall Street's consensus estimate of $0.77 per share.
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They came back with Zoom Video Communications (NASDAQ: ZM), DataDog (NASDAQ: DDOG), and The Trade Desk (NASDAQ: TTD). At the end of Q1, 75% of all customers are using more than one monitoring product, which is up from 63% last year. This advertising platform stock is hugely discounted right now Chris Neiger (The Trade Desk): Investors looking for a great SaaS stock that looks like a screaming buy right now should consider The Trade Desk.
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a0555a38-29fe-4275-b29f-134aadb444c4
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718862.0
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2021-05-11 00:00:00 UTC
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You Might Be Surprised What's Holding Up the Nasdaq Today
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DDOG
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https://www.nasdaq.com/articles/you-might-be-surprised-whats-holding-up-the-nasdaq-today-2021-05-11
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nan
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nan
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The stock market's volatility has ramped up another level, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) remains in the crosshairs of many investors' scorn. Early on Tuesday, the Nasdaq fell sharply, losing more than 2% right out of the gate. However, by 3 p.m. EDT, the index had recovered to just a 0.1% loss, far outpacing the bigger declines for most other stock market benchmarks.
It's been a frustrating period for growth stock investors, especially among technology companies that have seen such huge gains in the past year. Yet at least on Tuesday, the Nasdaq actually got a lot of support from those high-growth stocks. Below, we'll look more closely at what helped the Nasdaq avoid the steep losses that other stock market indexes suffered.
Image source: Zoom Video Communications.
Getting a bounce
On a down day for the market, it would be natural for investors in some of the Nasdaq's favorite stocks to figure that they'd be seeing red in their portfolios once again. However, that wasn't necessarily the case. In particular, some of the most popular software-as-a-service (SaaS) companies found their stock prices moving higher on the day:
Zoom Video Communications (NASDAQ: ZM) was one of the best performers in the Nasdaq-100, rising more than 4%.
Workplace collaboration software player Atlassian (NASDAQ: TEAM) also posted a gain of 4%, as did cloud-based data platform provider Splunk (NASDAQ: SPLK).
Several other SaaS companies were on the gainers list, including 3% rises for electronic signature specialist DocuSign (NASDAQ: DOCU) and cybersecurity company Okta (NASDAQ: OKTA). Datadog (NASDAQ: DDOG) settled for a 2% gain.
To be fair, all of these companies were ripe for a rebound. Even after today's gains, all six of these stocks are still down more than 10% from where they were in mid-February, when the Nasdaq was hitting record levels. Zoom, Splunk, and Datadog remain down around 30% over that time period.
Living with volatility
The challenge that every investor faces is that while the markets are open five days a week, companies only give out useful information on an occasional basis. In-depth financial reports that allow investors to get a close look at what's happening with a company's fundamental business only come four times a year, and updates in between quarterly reports tend to be fairly rare. Three months is a long time to go without any new news to consider about a company, but traders don't hesitate to push stocks up and down in that vacuum -- including some violent moves from time to time.
Moreover, you can't count on the market's reaction to important news to make sense in the short run. If a stock has done particularly well in the run-up to an earnings release, for instance, it might reverse and lose ground even after a favorable financial report. We've seen that happen on numerous occasions with stocks like these, and we've also seen some other stocks across the market show the opposite behavior -- rising despite questionable business results because the numbers weren't quite as bad as feared.
In the end, stock market volatility is something every investor has to come to terms with and accept. By focusing on business metrics, however, you can do a lot toward making yourself immune to the emotional impact of the inevitable ups and downs in stock prices along the way.
Find out why Zoom Video Communications is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
Tom and David just revealed their ten top stock picks for investors to buy right now. Zoom Video Communications is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of May 11, 2021
Dan Caplinger owns shares of Datadog and Zoom Video Communications. The Motley Fool owns shares of and recommends Atlassian, Datadog, DocuSign, Okta, Splunk, and Zoom Video Communications. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG) settled for a 2% gain. In particular, some of the most popular software-as-a-service (SaaS) companies found their stock prices moving higher on the day: Zoom Video Communications (NASDAQ: ZM) was one of the best performers in the Nasdaq-100, rising more than 4%. Living with volatility The challenge that every investor faces is that while the markets are open five days a week, companies only give out useful information on an occasional basis.
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Datadog (NASDAQ: DDOG) settled for a 2% gain. In particular, some of the most popular software-as-a-service (SaaS) companies found their stock prices moving higher on the day: Zoom Video Communications (NASDAQ: ZM) was one of the best performers in the Nasdaq-100, rising more than 4%. *Stock Advisor returns as of May 11, 2021 Dan Caplinger owns shares of Datadog and Zoom Video Communications.
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Datadog (NASDAQ: DDOG) settled for a 2% gain. In particular, some of the most popular software-as-a-service (SaaS) companies found their stock prices moving higher on the day: Zoom Video Communications (NASDAQ: ZM) was one of the best performers in the Nasdaq-100, rising more than 4%. Several other SaaS companies were on the gainers list, including 3% rises for electronic signature specialist DocuSign (NASDAQ: DOCU) and cybersecurity company Okta (NASDAQ: OKTA).
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Datadog (NASDAQ: DDOG) settled for a 2% gain. In-depth financial reports that allow investors to get a close look at what's happening with a company's fundamental business only come four times a year, and updates in between quarterly reports tend to be fairly rare. Find out why Zoom Video Communications is one of the 10 best stocks to buy now Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market.
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9c984849-865c-4566-b5cc-b740cf93f4de
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718863.0
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2021-05-07 00:00:00 UTC
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Tilray, Datadog Give Nasdaq Investors Something to Smile About
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DDOG
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https://www.nasdaq.com/articles/tilray-datadog-give-nasdaq-investors-something-to-smile-about-2021-05-07
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nan
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nan
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The Nasdaq Composite (NASDAQINDEX: ^IXIC) has gotten left out of the stock market party recently, as it hasn't been able to match the performance of other market benchmarks that have climbed to new all-time highs. But on Friday, the Nasdaq finally joined in on the fun, and it managed to power higher by nearly 1% to close the week on a positive note.
The Nasdaq has a lot of growth stocks, and many of those top names have suffered pullbacks in 2021 after impressive performance last year. Datadog (NASDAQ: DDOG) managed to claw back part of its lost ground on Friday as investors looked at its most recent earnings. First, though, we'll take a look at marijuana stock Tilray (NASDAQ: TLRY) to see what drove it even more sharply higher on Friday.
Tilray moves higher
Shares of Tilray popped higher by 14%. The cannabis company finally managed earlier this week to close its merger with industry peer Aphria, and now, the combined enterprise is starting to get some recognition for its accomplishments.
Image source: Getty Images.
Analysts at Jefferies had been downbeat on Tilray for a while, having had an underperform rating on the cannabis stock. However, Jefferies changed its tune on Friday, making a rare double ratings boost all the way to buy. They now argue that combining with Aphria was the best move Tilray could've made, and they believe that the post-merger company has plenty of room to grow not only in the U.S. and Canada but also in Europe.
Jefferies believes that the stock could climb to $23 per share. Tilray got a good part of the way there on Friday, but even after its big move upward, the price target still offers 42% upside from the close.
The big question throughout the industry is whether the U.S. will decriminalize marijuana at the federal level. That would give a huge boost to the entire playing field, but post-merger Tilray would be in an especially strong position to take advantage.
Datadog is an investor's best friend
Meanwhile, Datadog shares climbed 8%. The cloud-application monitoring service reported solid first-quarter results that took some of the sting out of recent share-price declines for the company.
Datadog's numbers looked strong. Revenue jumped more than 50% compared to the first quarter of 2020. The company now has 1,437 customers bringing in $100,000 or more in annual recurring revenue, up from just 960 a year ago. Adjusted earnings came in at $0.06 per share, once again demonstrating Datadog's ability to be profitable.
Datadog also has high hopes for the remainder of the year. Its full-year 2021 outlook includes calls for sales to come in between $880 million and $890 million, which would mark a growth rate of roughly 45% to 48% from 2020 levels. Adjusted earnings are likely to come in between $0.13 and $0.16 per share, according to the company.
Investors are excited at the strategic moves that Datadog has made recently, including the acquisition of software-as-a-service security platform Sqreen in April. Moreover, the company is working hard to offer new integrations with other cloud apps and services along with its own innovative products. All told, the cloud looks as healthy as ever, and Datadog is positioning itself to take advantage of its opportunity to stay on a steep growth curve higher.
10 stocks we like better than Tilray, Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Tilray, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Dan Caplinger owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog (NASDAQ: DDOG) managed to claw back part of its lost ground on Friday as investors looked at its most recent earnings. The cannabis company finally managed earlier this week to close its merger with industry peer Aphria, and now, the combined enterprise is starting to get some recognition for its accomplishments. Investors are excited at the strategic moves that Datadog has made recently, including the acquisition of software-as-a-service security platform Sqreen in April.
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Datadog (NASDAQ: DDOG) managed to claw back part of its lost ground on Friday as investors looked at its most recent earnings. First, though, we'll take a look at marijuana stock Tilray (NASDAQ: TLRY) to see what drove it even more sharply higher on Friday. Tilray moves higher Shares of Tilray popped higher by 14%.
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Datadog (NASDAQ: DDOG) managed to claw back part of its lost ground on Friday as investors looked at its most recent earnings. First, though, we'll take a look at marijuana stock Tilray (NASDAQ: TLRY) to see what drove it even more sharply higher on Friday. Tilray moves higher Shares of Tilray popped higher by 14%.
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Datadog (NASDAQ: DDOG) managed to claw back part of its lost ground on Friday as investors looked at its most recent earnings. Jefferies believes that the stock could climb to $23 per share. Datadog is an investor's best friend Meanwhile, Datadog shares climbed 8%.
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42af37ba-aaf3-4151-ba5d-a2ba0770258b
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718864.0
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2021-05-07 00:00:00 UTC
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Technology Sector Update for 05/07/2021: DDOG,GPRO,NET,STWO,GWH
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DDOG
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https://www.nasdaq.com/articles/technology-sector-update-for-05-07-2021%3A-ddoggpronetstwogwh-2021-05-07
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nan
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nan
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Technology stocks eased slightly from their market-leading gains earlier Friday, with the SPDR Technology Select Sector ETF rising 0.9% in late trade while the Philadelphia Semiconductor Index was advancing 1.5% this afternoon.
In company news, Datadog (DDOG) was 7.9% higher late in Friday trading after the data analytics company reported a $0.06 per share Q1 profit, matching its year-ago earnings, doubling up the Capital IQ consensus expecting $0.03 per share. Revenue for the quarter also topped analyst projections and the company is projecting Q2 revenue above Street views.
GoPro (GPRO) climbed 3.5% after the digital cameras company swung to a non-GAAP Q1 net income of $0.03 per share, reversing a $0.34 per share adjusted net loss during the year-ago period as revenue increased 70.6% year over year to $203.7 million. The Street was expecting a break-even Q1 on $186.7 million in revenue.
Cloudflare (NET) rose 3.4% after the cybersecurity firm said revenue increased to $138.1 million during its Q1 ended March 31 from $91.3 million during the same quarter in 2020 and beating the Capital IQ consensus expecting $133.1 million. It also provided an upbeat Q2 forecast.
ACON S2 Acquisition (STWO) still was fractionally higher, earlier climbing 1.3% after the blank-check company announced plans to merge with privately held ESS Tech. Current shareholders of the utility-scale energy storage firm will own about 64% of the combined companies, which will trade under the GWH ticker symbol after the deal closes.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In company news, Datadog (DDOG) was 7.9% higher late in Friday trading after the data analytics company reported a $0.06 per share Q1 profit, matching its year-ago earnings, doubling up the Capital IQ consensus expecting $0.03 per share. GoPro (GPRO) climbed 3.5% after the digital cameras company swung to a non-GAAP Q1 net income of $0.03 per share, reversing a $0.34 per share adjusted net loss during the year-ago period as revenue increased 70.6% year over year to $203.7 million. ACON S2 Acquisition (STWO) still was fractionally higher, earlier climbing 1.3% after the blank-check company announced plans to merge with privately held ESS Tech.
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In company news, Datadog (DDOG) was 7.9% higher late in Friday trading after the data analytics company reported a $0.06 per share Q1 profit, matching its year-ago earnings, doubling up the Capital IQ consensus expecting $0.03 per share. GoPro (GPRO) climbed 3.5% after the digital cameras company swung to a non-GAAP Q1 net income of $0.03 per share, reversing a $0.34 per share adjusted net loss during the year-ago period as revenue increased 70.6% year over year to $203.7 million. Cloudflare (NET) rose 3.4% after the cybersecurity firm said revenue increased to $138.1 million during its Q1 ended March 31 from $91.3 million during the same quarter in 2020 and beating the Capital IQ consensus expecting $133.1 million.
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In company news, Datadog (DDOG) was 7.9% higher late in Friday trading after the data analytics company reported a $0.06 per share Q1 profit, matching its year-ago earnings, doubling up the Capital IQ consensus expecting $0.03 per share. GoPro (GPRO) climbed 3.5% after the digital cameras company swung to a non-GAAP Q1 net income of $0.03 per share, reversing a $0.34 per share adjusted net loss during the year-ago period as revenue increased 70.6% year over year to $203.7 million. Cloudflare (NET) rose 3.4% after the cybersecurity firm said revenue increased to $138.1 million during its Q1 ended March 31 from $91.3 million during the same quarter in 2020 and beating the Capital IQ consensus expecting $133.1 million.
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In company news, Datadog (DDOG) was 7.9% higher late in Friday trading after the data analytics company reported a $0.06 per share Q1 profit, matching its year-ago earnings, doubling up the Capital IQ consensus expecting $0.03 per share. Technology stocks eased slightly from their market-leading gains earlier Friday, with the SPDR Technology Select Sector ETF rising 0.9% in late trade while the Philadelphia Semiconductor Index was advancing 1.5% this afternoon. Revenue for the quarter also topped analyst projections and the company is projecting Q2 revenue above Street views.
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2021-05-07 00:00:00 UTC
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Datadog Inc (DDOG) Q1 2021 Earnings Call Transcript
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DDOG
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https://www.nasdaq.com/articles/datadog-inc-ddog-q1-2021-earnings-call-transcript-2021-05-07
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Image source: The Motley Fool.
Datadog Inc (NASDAQ: DDOG)
Q1 2021 Earnings Call
May 06, 2021, 5:00 p.m. ET
Contents:
Prepared Remarks
Questions and Answers
Call Participants
Prepared Remarks:
Operator
Welcome to the Q1 2021 Datadogearnings conference call My name is Karen. I will be your operator for today's call. [Operator instructions] I will now turn the call over to Yuka Broderick, head of investor relations.
Yuka, you may begin.
Yuka Broderick -- Head of Investor Relations
Thank you, Karen. Good afternoon, and thank you for joining us today to review Datadog's first-quarter 2021 financial results, which we announced in our press release issued after the close of market today. Joining me on the call today are Olivier Pomel, Datadog's co-founder and CEO; and David Obstler, Datadog's CFO. During this call, we will make statements related to our business that are forward-looking under federal securities laws and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements related to our future financial performance, including our outlook for the second quarter and for the full year of 2021, our strategies, the potential benefits of our products, partnerships and investments in R&D and go-to-market, our ability to capitalize on our market opportunity and the impact of the COVID-19 pandemic on digital transformation and cloud migration trends as well as our ability to benefit from these trends.
The words anticipate, believe, continue, estimate, expect, intend, will and similar expressions are intended to identify forward-looking statements or similar indications of future expectations. These statements reflect our views only as of today and not as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For a discussion of the material risks and other important factors that could affect our actual results, please refer to our annual report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021.
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Additional information will be made available in our quarterly report on Form 10-Q for the quarterly period ended March 31, 2021, and other filings and reports that we may file from time to time with the SEC. Our filings with the SEC are available on the investor relations section of our website. A replay of this call will also be available there for a limited time. Non-GAAP financial measures will be discussed on this conference call.
Please refer to the tables in our earnings release, which you can find on the investor relations portion of our website for a reconciliation of these measures to their most directly comparable GAAP financial measures. With that, I'd like to turn the call over to Olivier.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Thanks, Yuka. Welcome to the team at Datadog, and thank you all for joining us today. We had a strong start to the year and are very pleased with our performance in Q1, which was strong across all parts of the business and again showed high growth at scale and demonstrated efficiencies. It has been a busy start of the year.
We had two products become generally available, continuous profiler and incident management. We closed the acquisitions of Sqreen and Timber, and we continued to release new features and innovations across our platform. In addition, we continue to hire and build our team at a very rapid pace. Now, onto a review of the quarter.
To summarize Q1, at a high level, revenue was $199 million, an increase of 51% year over year and above the high end of our guidance range. We ended the quarter with 1,437 customers with an ARR of $100,000 or more, up from 960 last year. These customers generate over 75% of our ARR. We have about 15,200 customers, up from about 11,500 in the year-ago quarter.
This means we added about 1,000 customers in the quarter, making it another strong quarter of adds and consistent with the last few quarters. We also continue to be capital-efficient with free cash flow of $44 million. And finally, our dollar-based net retention rate continues to be over 130% as customers increase their usage and adapted our newer products. In addition to that, the positive business trends from recent quarters have continued in Q1.
First, usage growth from existing customers was stronger than expected and above historical levels. Among other factors, we are seeing the benefit of new logos signed in the back half of last year as they grow into their commitment. Second, new logo ARR was strong in what is normally a seasonally slower quarter, showing our go-to-market investments are paying off. And third, churn continues to remain very low and in line with historical rates.
Taking all these factors into account, we had a very strong quarter of ARR added. In fact, we hit an important milestone as we added over $100 million of ARR in a single quarter for the first time. Next, our platform strategy continues to resonate and win in the market. As of the end of Q1, 75% of customers are using two or more products, which is up from 63% last year.
Additionally, 25% of customers are using four or more products, which is up from only 12% a year ago. And we also have hundreds of customers using six or more of our nine generally available products. But it's still early. We think this is an interesting proof point that shows the continued sell opportunity in our customer base.
And we had another quarter in which approximately 75% of new logos landed with two or more products. I'd like to provide an update on some of our more recent products, Network Performance Monitoring, Real User Monitoring and Synthetics. Both Network Performance Monitoring and Real User Monitoring became generally available a bit more than a year ago. And we are excited to share that both are at approximately eight figures of ARR and are showing high growth.
And Synthetics also continues to grow rapidly and is an increasingly important contributor to revenue. As a reminder, our newer products are often adopted first by self-selecting customers at a small scale before our land-and-expand model enables greater adoption over time. And frictionless adoption from our single integrated platform is a key value proposition for our customers. While we are very pleased with the performance of our newer products, I also want to spend some time on the core of our observability platform.
Infrastructure, APM and log. All three added record amounts of ARR in the quarter, showing the strength of our platform. APM and logs have both reached large scale and remain in hyper growth, while infrastructure continues to grow at a healthy base. To give you a sense of scale, APM and logs together added more ARR this quarter than the business as a whole did one year ago.
So it is clear to us that these products are each strong enough to be best-of-breed solutions on their own. And to that point, Datadog was recognized as a leader in Gartner's 2021 Magic Quadrant for APM for the first time. And in fact, we were the only vendor in the leader quadrant that improved its position since the last report. Gartner specifically highlighted our strong history of product development and our ability to bring products to market rapidly.
As a reminder, we entered the APM market just four years ago, and our APM product has a robust feature set, including end-to-end distributed tracing with no sampling and seamless correlation of traces with end-to-end observability. The ability to triage problem was also highlighted as a strength with our unified platform assisting in root-cause analysis and reducing resolution time. And lastly, our transparent pricing, which is available on our website, was also recognized as helping to build customer trust. We also continue to make investments in Watchdog, which is the brain behind AI-based features across the Datadog platform.
In Q1, we announced a few enhancements, including Watchdog Insights, which is a recommendation engine that is always on and augments manual investigations by automatically detecting anomalies and outliers and allowing for faster time to resolution. We also announced the beta of Watchdog root cause analysis, which automatically identifies causal relationships between different issues across applications and infrastructure and pinpoints the root cause. In addition, we continued innovating across our platform, releasing 38 features in Q1 and crossing 450 out-of-the-box integrations. A few features to highlight include network performance monitoring for Microsoft Windows, which is a very differentiated feature for that Datadog NPM.
New marketplace integrations, including Oracle Cloud as well as the official launch of our GovCloud instance allowing us to onboard early customers in the government space. Lastly, on the product side, I want to briefly discuss our acquisition of Sqreen, which closed in early April. We founded Datadog to break down silos between Dev and ops team. And as we've discussed previously, we are working to extend that to security teams as well.
Sqreen is an application security solution that actively detects attacks and can trace them down to the impacted function call. It prevents application security exploits and enables response across development, security and upstream. We are very excited at the combination of Sqreen with our APM and security offerings. As we expect it to allow our customers to protect APM insulated applications with very little additional friction.
And we will share updates as we progress on integrating it in our platform. Now let's switch gears and move on to sales and marketing. I am very proud of the continued productivity from our go-to-market team. As we mentioned last quarter, we have been hiring at a rapid pace across our sales work and are seeing more teams and reps becoming productive.
Now, let's discuss some of our wins this quarter. First, we had a seven figure land with one of the world's largest consulting firms undergoing a multibillion-dollar cloud migration. With Datadog, they have reduced their monitoring costs by more than 35% with greater visibility into every layer of their stack, including several at functions. Next, we had a six figure or high six figure , I should say, land deal with a major transportation company.
The company is moving toward the DevOps culture, but was hindered by a proliferation of siloed and underutilized monitoring tools. After implementing Datadog, engineers now have a single easy-to-use platform that facilitates mass adoption. Next, we had a six figure land from a large supermarket team. The company has thousands of stores and is in the process of migrating from legacy IT to an Azure-based cloud.
Datadog's unified platform helped enable this migration and reduced mean time to resolution by up to 50%. Next, I want to discuss the seven figure upsell with an EVA, online game company. Prior to Datadog, business units were spending too much time responding to incidents and look for a single source of truth with visibility across all teams and systems. This company reduced its usage from eight observability tools to one, and Datadog is also used by executives all the way up to the CEO.
Last, we had a seven figure upsell to an existing $1 million-plus customer in the financial services. During COVID, this large enterprise accelerated its digital transformation journey as they enhance their digital tools and online presence. And they continue to grow with Datadog as they migrate more work close to the cloud and have adopted newer products like NPM and Synthetics. Moving on now to our longer-term outlook.
While the pandemic continues to impact the macro environment, businesses are starting to turn to priorities in the post-COVID world. Businesses must be digital first, which we expect will move forward digital transformation project. Massive IT replatforming is still in its early stages. We believe we are in a great position with our unified observability platform.
While there is the possibility for more near-term volatility caused by the macro environment, we are increasingly confident in our ability to execute and in our long-term opportunity. Before giving the call to David, there are two changes to the management team I would like to bring to your attention. First, our Chief Revenue Officer, Dan Fougere, will transition out of the company this quarter to take some well-deserved time off after a few decades of hard work. We are very grateful to Dan for many quarters of growth and for developing a world-class organization.
We are confident that the team he's built will continue carrying the torch, and we exceed expectations to Datadog way. We are also running a search for a new CRO and are evaluating both internal and external candidates. Second, I'm pleased to announce that we will soon be joined by our first-ever chief operating officer, Adam Blitzer, who joins us after a successful tenure as an EVP and GM at Salesforce. Adam will help us scale as a SaaS platform company and will oversee a number of our front-office functions.
With that, I would like to turn the call over to our chief financial officer. David?
David Obstler -- Chief Financial Officer
Thanks, Olivier. We had a very strong start to the year. Revenues was $198.5 million, up 51% year over year against the challenging year-ago comp. Usage trends were strong and showed broad-based growth.
New logo generation continues to be strong and customers continue to adopt more products across the platform. To provide some more context, first, growth of existing customers was robust, again, and our dollar-based net retention rate remained above 130% for the 15th consecutive quarter. We are pleased with the usage growth of existing customers, which indicates continued adoption of our platform and continued migration to the cloud even in the face of macro pressures. As Oli mentioned, usage growth was stronger than expected and above historical levels.
And usage growth was broad-based across our customer base. Also, we added a record number of 100,000-plus customers in the quarter. Given our land-and-expand model, a majority of these adds were existing customers. In addition, we had a strong uptick in the quarter in million-dollar customers.
Next, our new logo results were strong. In fact, it was our second best new logo ARR quarter ever and a record for Q1. Contributions were strong across our enterprise and commercial sales channels. Earlier, Olivier shared several large new logo wins across more traditional industries, an encouraging sign as companies across a wide spectrum start embracing digital transformation projects.
Remember that given our use-based revenue model, new logo wins generally do not immediately translate into meaningful revenue. Next, In the first quarter, we saw continued strength, as Olivier discussed in our platform strategy, with 75% of our customers using two or more products, and 25% of our customers now using four or more products, up from only 12% a year ago. Next, churn was consistent with historical levels. This demonstrates the importance of our solution to our customers.
Our dollar-based gross retention rate has remained largely unchanged in the mid-90s. And this was true across customer segments and in each of our infrastructure, APM and log products. Taken together, this resulted in a record quarter of ARR adds, over $100 million and up significantly versus Q1 last year. Now turning to billings.
Billings were $220 million, up 59% year over year. There were no major pro forma impacts to call out in the quarter. Remaining performance obligations or RPO was $464 million, up 81% year over year. Contract duration continued to be at an increased level from the year-ago period.
RPO strength is driven by strong annual billings and commitments as well as a few large multiyear commits. It is important to note that those multiyear commits are built annually, and we do not incentivize our sales force for multiyear deals given our high net retention. Current RPO growth was also strong in the high 60s percent. As a reminder, billings and RPO can fluctuate versus revenue based on the timing of invoicing and the signing of customer contracts, while revenue incorporates customer usage.
Now, let's review the income statement in more detail. As a reminder, unless otherwise noted, all metrics are non-GAAP. We have provided a reconciliation of GAAP to non-GAAP financials in our earnings release. Gross profit in the quarter was $153 million, representing a gross margin of 77%.
This compares to a gross margin of 78% last quarter and 80% in the year-ago period. The slight decrease in gross margin, as we've discussed before, is due to our investments in product and platform innovation. We expect gross margin to continue to be slightly down from last year in the remainder of the year as we build out new cloud data centers and prioritize product development. R&D expense was $61 million or 31% of revenue compared to 27% in the year-ago quarter.
We continue to invest significantly in R&D, including a high growth in our engineering headcount. Engineering headcount continues to grow slightly ahead of the pace of revenue growth, and we have been able to attract talent and are successfully executing on our hiring and onboarding plans despite COVID. Sales and marketing expense was $53 million or 28% of revenues compared to 32% in the year-ago period. Similar to R&D, we continue to make substantial investments in sales and marketing, but the pace of the revenue growth has outpassed pace investment growth.
This was another quarter of no in-person trade shows and marketing events. And while we have successfully redeployed much of the events budget to advertising and other lead-generating activities, it is not on a one-for-one ratio. G&A expense was $16 million or 8% of revenue, slightly lower than the 9% in the year-ago quarter. And operating income was $20 million, or a 10% operating margin compared to an operating income of $16 million or 12% in the year-ago period.
Non-GAAP net income for the quarter was $20 million or $0.06 a share based on 344 million weighted average diluted shares outstanding. Now turning to the balance sheet and cash flow. We ended the quarter with $1.6 billion in cash, cash equivalents, restricted cash and marketable securities. Cash from operation was a strong $52 million in the quarter.
After taking into consideration capital expenditures and capitalized software, free cash flow was $44 million for a margin of 22%. Free cash flow was driven by strong collections stemming from our strong billings in Q4 and Q1. Now turning to our outlook for the second quarter and the full-year 2021. We believe we can deliver high growth for the foreseeable future as we are addressing a very large greenfield market and are executing well against that opportunity.
We are optimistic about the long-term opportunity and have seen an uptick in metrics driving our business growth. Taking this into account with our usual conservatism implied, we are updating our guidance as follows. For the second quarter, we expect revenue to be in the range of $211 million to $213 million, which represents a year-over-year growth of 51% at the midpoint. Non-GAAP operating income is expected to be in the range of $9 million to $11 million.
And non-GAAP net income per share is expected to be in the $0.03 to $0.04 per range based on an approximate 344 million weighted average diluted shares outstanding. For the full-year 2021, revenues are expected to be in the range of $880 million to $890 million, which represents a 47% year-over-year growth at the midpoint. Non-GAAP operating income is expected to be in the range of $45 million to $55 million. And non-GAAP net income per share is expected to be in the range of $0.13 to $0.16 per share based on 345 million weighted average diluted shares.
Now, some notes on our guidance. While usage growth was strong in Q1, when providing guidance, as usual, we use more conservative assumptions. Next, our strategic focus remains investing to optimize for the long term. Therefore, we are planning to continue aggressive investments in R&D and go-to-market throughout 2021.
We believe the efficiencies of our business are evident, and we are confident in our ability to be a sizable and materially profitable company over the long term. Additionally, our model assumes the return to the office and a resumption of travel and in-person events in the second half of the year. We have limited visibility on these topics, but believe it's prudent to incorporate this in our outlook. Finally, in early April, we closed our acquisition of Sqreen.
We are pleased to welcome more than 50 members of the Sqreen team to Datadog. The acquisition has an immaterial impact on our income statement. And our cash flow statement in Q2 will reflect the $190 million of cash that we paid for the acquisition. Now, below the operating income line.
We expect approximately $1 million of Q2 non-GAAP other income, which is net including the interest income on our cash and marketable securities, less the interest expense on our convertible debt. We do not expect to be a federal taxpayer in 2021, but have a tax provision related to our international entity. We expect the tax provision to be approximately $700,000 in Q2 and $3 million for the full year. Now to summarize, we are very pleased with the results of the quarter.
Customers continue to consume more Datadog, both in terms of usage and cross-selling to newer products, and the execution remains strong. We believe the importance of our solutions will only be strengthened long term by the continued trends of cloud migration and digital transformation. And now with that, we'll open the call for questions. Operator, let's begin the Q&A.
Questions & Answers:
Operator
[Operator instructions] And we do have our first question from Raimo Lenschow from Barclays.
Raimo Lenschow -- Barclays -- Analyst
Hey, thanks and congrats on an amazing quarter. Olivier, can you -- you talked about the growing momentum you have around an APM and the recognition you get from the industry experts. Can you talk a little bit about where we are in terms of APM adoption in your client base in terms of number of applications that are getting properly monitored? And what are you seeing in terms of where you are getting used where maybe some of the traditional legacy guys are getting used for APM?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah. So great question. I think we are seeing a lot of adoption from APM. And I think when we back -- a year ago when we took the company public, we were saying that APM probably had a bit of a longer fuse to it, but had a very long runway, as more and more applications move to the cloud and more of them become critical.
And that's what we see happening today. In terms of our penetration among customer applications, like exceeded the ratio of the, let's call it, the instances of containers that are covered with APM from the total APM containers that we see for infrastructure monitoring. There's still quite a bit of runway there, but that ratio is already higher than the famous Gartner quote of five personal applications being monitored. So we think we're clearly targeting those applications in next-gen cloud environment.
We are starting to see from some of our larger enterprise customers, some of their on-prem applications that are being instrumented with our APM as well. But I would say that's more of a Phase 2 of adoption as opposed to what we need with, and we start those customers.
Operator
Thank you. And we do have our next question from Sanjit Singh from Morgan Stanley.
Sanjit Singh -- Morgan Stanley -- Analyst
Thank you for taking the questions and congrats to the team on a really exceptional quarter, really great start to the year. To follow-on on Raimo's question, I think what's sort of impressing me is the multiproduct adoption and frankly, in some of the newer categories. So you mentioned APM and logs, but you also called out networking as well and some of the other new products. When you think of the networking opportunity, what's driving that strong growth? Is it just the maturity of the products or is it being a year two product? Or did you see some benefits from some of the competitors like SolarWinds post the SUNBURST attack.
How do you see that networking opportunity for Datadog relative to APM and some of the other products?
Olivier Pomel -- Co-Founder and Chief Executive Officer
I think it's a combination of -- there's a lot of market need. Because networking, especially in next-generation cloud environment, especially for companies that have one foot in the cloud and one foot in prem is not something that is well covered in terms of monitoring and understanding. So there's a big need there. And the second part of that is, as you mentioned, the product maturity.
I mean that product is getting better and better. It covers more and more of the use cases, which means it goes from being great for a small number of customers to being great for a larger and larger fraction of our market and customer base. One illustration of that is what we announced -- or we mentioned in the call today, which is the Network Performance Monitoring today also works for Microsoft Windows. And as it turns out, it's fairly differentiated to have a cloud-based network performance monitoring product that also works for Microsoft Windows.
And it helps a lot of those customers with very hybrid deployments.
Sanjit Singh -- Morgan Stanley -- Analyst
That makes a ton of sense. And then as a follow-up question, as we think about the new announcement, the great hire for the COO position, can you sort of walk us through the thinking around why now is the right time to bring a COO on board? Was it -- is about where the business is in terms of scale? Or is there a certain new market segments that you want to target? What was sort of the thinking behind bringing on a chief operating officer to Datadog?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Well, the thinking is we need to scale the team. We -- if we fast forward a few years, we will be a lot bigger. We're building a platform. There's a number of things that we'll need to do right, and there's a number of -- there's going to be a number of problems to solve along the way.
And it was always a given that we would need to grow the bandwidth of the senior management team. And as we embarked on that, we also thought to bring into the company some experience with what later stages of scale and growth look like for SaaS companies, especially SaaS platform companies, which explains to you the hire we're making here.
Sanjit Singh -- Morgan Stanley -- Analyst
Makes a ton of sense. Congrats again, thank you.
Operator
And we do have our next question from Brent Thill from Jefferies.
Brent Thill -- Jefferies -- Analyst
Thanks. I just wanted to follow up on the question around Adam. Obviously, a huge endorsement for you guys. But Adam was the founder of the company and effectively was running a lot of the outbound activity.
And I'm curious, most COOs, at least the definition of taking care of the inside of the company versus the outside. Can you just talk to his role on the outside and with customers in the interaction versus the focus on the inside? I think there's just some -- I'm trying to understand where he's going to be spending most of his time.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah, it's a great question. And the focus is actually a lot of the front office function. And these are going to have to do with servicing our customers and growing our customers. I won't go into too much detail.
I mean we look -- our teams are -- we have a fairly intricate setup for how we'll go-to-market and how we serve customers, that is aligned with our land-and-expand low friction model. But Adam is going to lead a number of those teams.
Brent Thill -- Jefferies -- Analyst
OK, Great.
Olivier Pomel -- Co-Founder and Chief Executive Officer
And focus is outwards instead of inwards.
Brent Thill -- Jefferies -- Analyst
OK. That's great. And a quick one for David. Just you mentioned duration is up.
Can you remind us what the duration is now versus what you saw a year ago?
David Obstler -- Chief Financial Officer
Yes. On the billings duration, we said it in the seven -- around seven months and the contract duration spread out toward -- more toward a year in the 9-plus months. and it's maintained that. So what we saw was over the last couple of quarters, given the multiyear contracts and the increase of annual billing, the contract duration increased.
Brent Thill -- Jefferies -- Analyst
OK. Thanks for the color.
Operator
And we do have our next question from Matt Hedberg from RBC.
Matt Swanson -- RBC Capital Markets -- Analyst
Yeah, thank you. This is actually Matt Swanson on for Matt. So thinking about the capabilities of Sqreen and the potential cross-sell opportunity, could you give us a little color on what type of solutions your customers currently have to address these needs? And if you think of this as a competitive environment within your customers or more of another greenfield opportunity?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah. So it's really more of a greenfield opportunity. Today, customers typically don't have anything or they have something, it's not really deployed. And the reason for that is that to inject application security inside the applications, there's actually quite a bit of friction.
Where the combination with Datadog and with our APM makes sense is that we've already incurred that friction to instrument the application with APM and the point of inflection is the same. And that's where we think the -- probably all one plus one equals three happens by adding Sqreen to Datadog. And I should say, it's only going to be the start. I mean we -- there's a lot more we want to do in application security.
In the rest of security, the first step is we need to plug the -- this protection -- detection and protection directly at the APM level with Sqreen.
Matt Swanson -- RBC Capital Markets -- Analyst
Well, and that kind of leads directly into what I wanted to go to for my second question, which is Olivier, you guys really have a front-row seat to digital transformation. And you obviously then get to also see some of the security challenges that arise from that. So what are some of those other areas of security that maybe you're seeing as pain points for your customers?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Well, there's many a look to there. It seems like every other month, there's a large-scale attack that brings a new area of security into focus. But the way we see the world and the way it relates to us, we are focusing on applications in the cloud. And for that, we think there are important aspects of it that happened at the application level, which is what we're addressing with Sqreen.
There are important aspects of it that are happening at the infrastructure level. And we have a few different products that we started last year and that we're still developing and shipping around that. Then there's one big part of it that has to do with putting all this information together into an actionable system of record with -- in the on-prem world would be a theme. We also have a product, a security monitoring product that is a precursor to a theme that we're building into a theme that's not there yet.
So we really intend to cover that whole spectrum specifically for applications on the cloud and specifically for use cases that are going to bring together DevOps and security. In general, when you think of the problems companies have in this current environment, the first one is that the tooling is very variable and most of it doesn't exist or it's too a high friction it doesn't get developed -- don't get deployed. But the other thing that happens in most of these companies that is really, really hard to operationalize security because it's hard to get that in ops and security to be on the same page and can work together. And that's where I think we can make a big difference if we use our platform the right way and if you build all those products, right.
Matt Swanson -- RBC Capital Markets -- Analyst
Thank you.
Operator
And we do have our next question from Bhavan Suri from William Blair.
Bhavan Suri -- William Blair -- Analyst
Hey, thanks for taking my question and congrats on another well-executed quarter. I wanted to touch on the partner network. You announced kind of the launch of the formal partner network in January, kind of expands go-to-market, self-service, fermentation, things like that. Can you just talk about the early interest you're seeing there, the traction because you're not a heavy services company.
There's not a lot of implementation or lift here. So how is that playing out? And kind of how does that plan to sort of more of a medium-term, long-term channel strategy? Is this really a growth driver? Is this sort of efficiency driver? How should we think about that?
Olivier Pomel -- Co-Founder and Chief Executive Officer
So for us, it's really a growth driver, right. I think when you look at Datadog, we have plenty of efficiency. And the way we think about everything is how do we get the biggest part of that market, which we think is going to be gigantic. How do we build the products we need to get to all that? How do we reach all the customers across all regions and all segments to get there.
So that's how we think about it. So when we look at our partner program, we see it to that lens, and we are very happy with the adoptions we've had there. There's a number of things need to do still. I mean it's still, I would say, very early.
We have validating wins like we've talked about some of those in previous calls, but there's a lot more we want to build over the next year, I would say. So no specific update in this quarter but I do expect that we'll talk about it again.
Bhavan Suri -- William Blair -- Analyst
Got you. Got you. Got you. And then I want to touch a little bit on sort of pricing and competition kind of combined.
If I was to look at pricing in general, your view as kind of having a really attractive price point in terms of modern vendors. But then as you get into enterprises, given the scale you're being deployed at, whether pricing is cheap or expense is different, but it becomes a big number. And guys like New Relic, Sumo, Splunk have all made adjustment in pricing models in the last 12 months. In your last quarter, you said you were having a pricing model.
But I'm just wondering, are you seeing any pushback at the enterprise level? Are you seeing customers ask for price concessions. Anecdotally, just some sense of the confidence you have that there is sort of a nonissue around pricing at that enterprise level, given the scale you're getting deployed. I'd love to understand how you think about that. And what you're seeing competitively as those guys sort of use pricing as a or maybe even as a way to get into some accounts.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah. So -- yes, so first of all, on pricing and price push back -- look, we have customers that pay us more than $10 million a year. Anybody who is paying you that -- somebody is paying them $10 million a year and he is not asking for a lower price, because they probably -- so -- but look, at the end of the day, the way we think about it is this is very high leverage spend for our customers, when you see the time to what they spend on their infrastructure and on their engineering teams. And the way we think about pricing for all the data and everything they send us is that the amount of data are going to go exponentially over time.
They're going to grow faster than these customers' top line for particular purposes. And so pricing will have to adapt how smart we are about getting, interpreting that data or how we price and how we structure the model that these customers scale more and more with us. I will say that we -- while we do have pricing conversion with customers, especially large ones, we don't see the kind of competitive cash flow pressure, you might imagine if you read the competition in the marketing website. The best illustration of that would be, I think David mentioned in the call that we had gross retention in the mid-90s, and this is stable across various segments of our customers and also stable across products.
If you take each of our infrastructure, APM and logs products, individually, you see the same numbers. What this tells you is that there's very little that goes away. There's not a lot of room there for cut-throat price-driven competition.
Bhavan Suri -- William Blair -- Analyst
Got you. Got you. Super helpful. Thank you.
Thanks for taking my questions and great job again.
Operator
And we do have our next question from Michael Turits from KeyBanc.
Michael Turits -- KeyBanc Capital Markets -- Analyst
Hey, guys. First off, congratulations. I plan to continue on the competitive front relative to a couple of -- in a couple of directions. One, obviously, an announcement from Splunk recently.
Secondly, the impact of open source of telemetry and third, whether or not there's any change from the cloud vendors recent announcement or GA from AWS.
Olivier Pomel -- Co-Founder and Chief Executive Officer
So I have the usual boring answer, which is that we don't really see any change in the competitive landscape. It's a bit early for me to comment on the Splunk announcements because I think you they just did that yesterday. But from what we could see, it seems to be a formal announcement from the repackaging of the products they have been doing for the past few quarters and that we had seen in the market. So there's no big change or surprise.
And on the other side, we don't see from anybody else, we don't see any big change that is impacting us much. The biggest impact of competitive announcements I see is typically the day of the announcement where somebody has to figure out what's going on and explain it, and that's about it. We think -- we can't -- we are not competition-driven product development and we're also not competition-driven in our go-to-market.
Michael Turits -- KeyBanc Capital Markets -- Analyst
So Olivier, I'll just follow-up on that, maybe just to drill down further, open telemetry. Is there any sense that with open telemetry that the agent is essentially commoditizes that, and if so, is that forcing you in any way to focus even more so, let's call it, up the stack in terms of analytics or other value-add?
Olivier Pomel -- Co-Founder and Chief Executive Officer
So we -- so first of all, we're fully -- we're all in on open telemetry as well. And to us, it's not a change, right? Our agent was open source already. It's -- it was free for everybody including our competition to reduce. We leaned on -- into open source format and libraries to instrumental applications for a very long time, and we support a large number of them.
So when we see the problem is not -- what matters is not what technology we use to get there from here to there. What matters is to solve the end-to-end problem for our customers and to make it as easy as possible for them to just plug us in and everything just work, everything just show up. We turn their mass -- their gigantic mass with all these different technologies and applications and cloud and everything else. We turn that into something that they understand and is well ordered without any effort.
That's what the market in the end, and that's what we see all of this. And the various PCs that appear in the middle, like the formats and the libraries and everything else. This will change. It has change, it will change and it doesn't matter.
Operator
We have our next question from Jack Andrews from Needham.
Jack Andrews -- Needham & Company -- Analyst
Good afternoon. Thanks for taking my question. I apologize, I've been jumping around calls. But I just had a broader question.
Just when we think about just the proliferation of new products that you continue to introduce, how would you characterize where your sales force is in terms of just their knowledge and ability to really understand and appropriately sell all this functionality that you have to offer?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Well, so far it's working, I think. Look, we do have a fairly differentiated go-to-market in the way we organize internally which teams, how we land -- what we land with and whole customers adopt our product and how they learned about those products. So we -- this doesn't rely on having every single sales rep, understanding every single little feature we have in every part of the product that wouldn't be practical. So it is working.
We're very confident in that. I would say, there's a point at which we might have to consider tweaking the way we go-to-market. And I think that we'll have to do more with when we start actively selling to what might be different virus. And I think we've discussed it before, but I'm thinking more specifically of the security market.
We're not there yet. We're not actively pushing to security buyers today with our product. But when that happens, we may have to make some tweaks. We're not there yet.
Jack Andrews -- Needham & Company -- Analyst
OK, thanks. And just as a quick follow-up. Could you maybe just talk about how much of your new business today is perhaps generated from partnerships with the public cloud vendors? I believe you now have strategic relationships with all three of the big clouds entering the year here. So how should we be thinking about their relative contributions moving forward?
Olivier Pomel -- Co-Founder and Chief Executive Officer
So we don't have any numbers to share around that. I will say that A lot of the -- historically, a lot of that has been informal in that we work alongside the cloud provider, but there's no formal agreement of rev share and everything else. We started to put some of those in place more recently around the committed resources for going to market jointly and things like that, but we don't have anything to share on that.
Jack Andrews -- Needham & Company -- Analyst
OK, thanks. Congratulations on the result.
Operator
And we do have our next question from Andrew Nowinski from Davidson.
Andrew Nowinski -- D.A. Davidson -- Analyst
Customers I think you had 97 in Q4 that spent over $1 million in ARR. Can you just give us any more color around what you called a strong uptick in those customers this quarter? And then did you have any outsized deals in the quarter?
David Obstler -- Chief Financial Officer
Let me just take that as a metric. We said we were going to announce that once a year and give some comment on flavor. So we're not going to give the number, but it was -- it's a strong uptick. And as we talked about, it has a lot to do with the expansion of customers into that $1 million range.
As far as a concentration in the quarter, nothing out of the ordinary. We continue to have some very needy lands, but given the land-and-expand model and the number of customers you bring on, we don't have a concentration that produces a quarter.
Andrew Nowinski -- D.A. Davidson -- Analyst
OK, great. And then maybe just a follow-up question on the gross margin side, you ticked down a little bit lower than expected. Was there anything abnormal on the gross margin side? Or do you expect that to come back up going forward?
Olivier Pomel -- Co-Founder and Chief Executive Officer
So on the gross margin, so the way we think about it is this is due to us having the product teams work on product development instead of working on optimizing. And we're still happy with gross margins where they are. They might still fluctuate. They probably would fluctuate a bit lower than they were last year because we're very busy building product.
But there's nothing fundamentally changed around our margin. And there's many other things we can do in the future to optimize if we so wish. So right now, the call we're making is, we focus on product development, we focus on making sure that we grow the top line in the short and mid-term. And then we -- if it get out of hand on the gross margin side, we'll spend some more time on optimization.
Andrew Nowinski -- D.A. Davidson -- Analyst
Got it. Thank you.
Operator
And we do have our next question from Chris Merwin from Goldman Sachs.
Chris Merwin -- Goldman Sachs -- Analyst
Hi. Thanks for taking my question. I wanted to ask about the CRO position. I think you mentioned in the prepared remarks, looking for a new one.
I mean should we take that to mean that perhaps it was more -- even more of an enterprise focus as it relates to your go-to-market organization. Just curious what type of person you're looking for? And what, if anything, we should read into as we think about any sort of evolution with the go-to-market motion of the company? Thank you.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah, there's really nothing to read to it. I think it's a continuation of what we have. I would say right now, we have a deep bench on the sales leadership side. We're very happy with the leadership we have in place.
And we're still going to be -- going to be looking for a new CRO and we'll be going to be looking at candidates both internally and externally for that. But there's no willing, desire to change scores or do anything different from what we were.
Chris Merwin -- Goldman Sachs -- Analyst
Got it. And apologies if this has been asked. But in terms of duration, I know that in prior quarters, it seems like that was coming in, customers were looking to do shorter deals. Anything changing on that front? I mean it seems like all the -- there's more tailwinds behind the business, certainly as we get into a recovery here, used to just going higher.
Just curious if you could comment on duration.
David Obstler -- Chief Financial Officer
Yeah, it pulled in and we talked about in Q3 as risk management happened. And then we said in Q4, both billings and contract duration pull back out basically in billings in the seven -- seven to eight in contract duration, nine, 10, around that. And it had to do with clients -- client preferences. And we continue to have that same sort of duration in Q1 that we had in Q4.
So it's very similar to the trend we talked about last time, which is more duration on contracts year over year. But between Q4 and Q1, there really wasn't much change in the way clients approach the contracting.
Chris Merwin -- Goldman Sachs -- Analyst
Got it. Thanks very much.
Operator
And we do have our next question from Yun Kim from Loop Capital.
Yun Kim -- Loop Capital Markets -- Analyst
Great. First, congrats on a strong quarter, Oli and David. You mentioned that strong usage trend driving strong results in the quarter. Is there any way to qualify whether that strength in usage came from existing deployments or relatively new deployments that just happened to ramp in the quarter? And then also on usage, I know it's only Q1, but how much of that strength in usage was already captured in the contract versus the usage that came in well above contract provision.
So that caused customers to kind of renew at a higher contract volume?
David Obstler -- Chief Financial Officer
Do you want to take -- I'll start with that. So we had -- it was very broad-based across industries. We had a combination of customers that we brought on with the strong new logos in the second half of the year and in Q1 begin to ramp because we are land and expand, and customers that were already using us and have been using us for a year or more, increase their activities. We think it has a lot to do with the increase of activity on digital transformation and workloads.
As in previous quarters, about two-thirds of the increase of usage was from customers using more of the products they had purchased in the previous periods and about one-third was cross-sell or new and that continued in the quarter. So it was a combination of new logos, increased usage of existing products and very robust cross-selling and adoption of the platform.
Yun Kim -- Loop Capital Markets -- Analyst
OK. Great. So there wasn't any necessarily different trend that kind of drove the upside in the usage trend in the quarter per se from previous quarters?
David Obstler -- Chief Financial Officer
It was very -- it was broad. All three of those were positive in terms of both the scaling of new customers, the cross-sell and the increased usage of existing products.
Yun Kim -- Loop Capital Markets -- Analyst
OK. Great. And then just last question for me. Could you just talk about any geographical trend that you're seeing out there that you expect to see for this year, especially in Europe? Thanks.
David Obstler -- Chief Financial Officer
Europe -- let me take that. Europe has been strong for us. We have not seen the slower vaccination attract, and we have seen pretty good resumption of growth across all the geographies. We'll have to continue to watch it because there's variation in back to work and back to office.
But as it relates to Q1 and Q4, we saw fairly uniform strength across the regions.
Yun Kim -- Loop Capital Markets -- Analyst
OK, great. Thank you so much.
Operator
And we do have our next question from Gregg Mosonsky from Mizuho.
Unknown speaker -- Mizuho Securities -- Analyst
OK, thank you very much and really nice quarter, guys. First question is on Datadog continuous profiler. Now that it's GA, what sort of trial and paid activity have you seen so far? It would seem like there would be a lot of interest in getting ongoing visibility into code performance, but any early anecdotes would be helpful there.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Yeah. So very happy with the product, been very strong out of the gate. We don't have any numbers to share. And still -- like it's so early in the cycle that there's still a number of things that we need to do to the product that.
It works well for everyone who wants to use it. But it's a product that is beloved by its users, put it this way. So it's got a very strong plan is the anecdote I can give you.
Unknown speaker -- Mizuho Securities -- Analyst
OK. That's great. And then you mentioned earlier that you saw an uptick in metrics. Would you say that your internal metrics are back to pre-pandemic levels or not quite yet?
Olivier Pomel -- Co-Founder and Chief Executive Officer
Well, I think it's -- at this point, I'm losing track of what we're comparing to back to pre-pandemic level. So far back. But we -- look, we're very happy with what happened over the Q3, Q4 and Q1. We had a very, very strong Q1.
We still think -- we don't know what the macro is going to -- who is going to impact us. We still think the -- because all our customers are -- have been affected the same way at the same time, we just a little bit more uncertain than it used to be. But look, we feel good about the business, right? I think we just increased the guidance for the full year. I think it went from 38% or so growth to 47%.
That should tell you that we feel great about where we are about the business.
Unknown speaker -- Mizuho Securities -- Analyst
OK, that's helpful. Thanks, Olivier.
Operator
This concludes the question-and-answer portion. I will now turn the call over to Olivier Pomel for closing remarks.
Olivier Pomel -- Co-Founder and Chief Executive Officer
Thank you. And in closing, I would just want to reiterate that we're very, very pleased with our performance to start the year. And then I am personally very proud of our execution, and I want to thank all of our employees, all Datadogs for their continued hard work. Thank you all.
Operator
[Operator signoff]
Duration: 58 minutes
Call participants:
Yuka Broderick -- Head of Investor Relations
Olivier Pomel -- Co-Founder and Chief Executive Officer
David Obstler -- Chief Financial Officer
Raimo Lenschow -- Barclays -- Analyst
Sanjit Singh -- Morgan Stanley -- Analyst
Brent Thill -- Jefferies -- Analyst
Matt Swanson -- RBC Capital Markets -- Analyst
Bhavan Suri -- William Blair -- Analyst
Michael Turits -- KeyBanc Capital Markets -- Analyst
Jack Andrews -- Needham & Company -- Analyst
Andrew Nowinski -- D.A. Davidson -- Analyst
Chris Merwin -- Goldman Sachs -- Analyst
Yun Kim -- Loop Capital Markets -- Analyst
Unknown speaker -- Mizuho Securities -- Analyst
More DDOG analysis
All earnings call transcripts
This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.
The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog Inc (NASDAQ: DDOG) Q1 2021 Earnings Call May 06, 2021, 5:00 p.m. Davidson -- Analyst Chris Merwin -- Goldman Sachs -- Analyst Yun Kim -- Loop Capital Markets -- Analyst Unknown speaker -- Mizuho Securities -- Analyst More DDOG analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. During this call, we will make statements related to our business that are forward-looking under federal securities laws and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements related to our future financial performance, including our outlook for the second quarter and for the full year of 2021, our strategies, the potential benefits of our products, partnerships and investments in R&D and go-to-market, our ability to capitalize on our market opportunity and the impact of the COVID-19 pandemic on digital transformation and cloud migration trends as well as our ability to benefit from these trends.
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Davidson -- Analyst Chris Merwin -- Goldman Sachs -- Analyst Yun Kim -- Loop Capital Markets -- Analyst Unknown speaker -- Mizuho Securities -- Analyst More DDOG analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. Datadog Inc (NASDAQ: DDOG) Q1 2021 Earnings Call May 06, 2021, 5:00 p.m. Earlier, Olivier shared several large new logo wins across more traditional industries, an encouraging sign as companies across a wide spectrum start embracing digital transformation projects.
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Datadog Inc (NASDAQ: DDOG) Q1 2021 Earnings Call May 06, 2021, 5:00 p.m. Davidson -- Analyst Chris Merwin -- Goldman Sachs -- Analyst Yun Kim -- Loop Capital Markets -- Analyst Unknown speaker -- Mizuho Securities -- Analyst More DDOG analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. During this call, we will make statements related to our business that are forward-looking under federal securities laws and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements related to our future financial performance, including our outlook for the second quarter and for the full year of 2021, our strategies, the potential benefits of our products, partnerships and investments in R&D and go-to-market, our ability to capitalize on our market opportunity and the impact of the COVID-19 pandemic on digital transformation and cloud migration trends as well as our ability to benefit from these trends.
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Davidson -- Analyst Chris Merwin -- Goldman Sachs -- Analyst Yun Kim -- Loop Capital Markets -- Analyst Unknown speaker -- Mizuho Securities -- Analyst More DDOG analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. Datadog Inc (NASDAQ: DDOG) Q1 2021 Earnings Call May 06, 2021, 5:00 p.m. Next, In the first quarter, we saw continued strength, as Olivier discussed in our platform strategy, with 75% of our customers using two or more products, and 25% of our customers now using four or more products, up from only 12% a year ago.
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36f04f1a-0e70-4bbb-b9fd-64d5616ee1e0
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718866.0
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2021-05-06 00:00:00 UTC
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Notable Thursday Option Activity: RDFN, ELY, DDOG
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DDOG
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https://www.nasdaq.com/articles/notable-thursday-option-activity%3A-rdfn-ely-ddog-2021-05-06
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Redfin Corp (Symbol: RDFN), where a total volume of 17,148 contracts has been traded thus far today, a contract volume which is representative of approximately 1.7 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 129% of RDFN's average daily trading volume over the past month, of 1.3 million shares. Especially high volume was seen for the $60 strike call option expiring August 20, 2021, with 1,477 contracts trading so far today, representing approximately 147,700 underlying shares of RDFN. Below is a chart showing RDFN's trailing twelve month trading history, with the $60 strike highlighted in orange:
Callaway Golf Co (Symbol: ELY) options are showing a volume of 17,095 contracts thus far today. That number of contracts represents approximately 1.7 million underlying shares, working out to a sizeable 126.1% of ELY's average daily trading volume over the past month, of 1.4 million shares. Particularly high volume was seen for the $31 strike call option expiring May 21, 2021, with 2,996 contracts trading so far today, representing approximately 299,600 underlying shares of ELY. Below is a chart showing ELY's trailing twelve month trading history, with the $31 strike highlighted in orange:
And Datadog Inc (Symbol: DDOG) options are showing a volume of 33,586 contracts thus far today. That number of contracts represents approximately 3.4 million underlying shares, working out to a sizeable 124.7% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Especially high volume was seen for the $70 strike call option expiring May 21, 2021, with 1,247 contracts trading so far today, representing approximately 124,700 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $70 strike highlighted in orange:
For the various different available expirations for RDFN options, ELY options, or DDOG options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $70 strike call option expiring May 21, 2021, with 1,247 contracts trading so far today, representing approximately 124,700 underlying shares of DDOG. Below is a chart showing ELY's trailing twelve month trading history, with the $31 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 33,586 contracts thus far today. That number of contracts represents approximately 3.4 million underlying shares, working out to a sizeable 124.7% of DDOG's average daily trading volume over the past month, of 2.7 million shares.
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That number of contracts represents approximately 3.4 million underlying shares, working out to a sizeable 124.7% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Below is a chart showing ELY's trailing twelve month trading history, with the $31 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 33,586 contracts thus far today. Especially high volume was seen for the $70 strike call option expiring May 21, 2021, with 1,247 contracts trading so far today, representing approximately 124,700 underlying shares of DDOG.
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That number of contracts represents approximately 3.4 million underlying shares, working out to a sizeable 124.7% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Below is a chart showing ELY's trailing twelve month trading history, with the $31 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 33,586 contracts thus far today. Especially high volume was seen for the $70 strike call option expiring May 21, 2021, with 1,247 contracts trading so far today, representing approximately 124,700 underlying shares of DDOG.
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That number of contracts represents approximately 3.4 million underlying shares, working out to a sizeable 124.7% of DDOG's average daily trading volume over the past month, of 2.7 million shares. Especially high volume was seen for the $70 strike call option expiring May 21, 2021, with 1,247 contracts trading so far today, representing approximately 124,700 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $70 strike highlighted in orange: For the various different available expirations for RDFN options, ELY options, or DDOG options, visit StockOptionsChannel.com.
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e71112c0-c7c7-4c39-a3dd-8099584b0f3f
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718867.0
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2021-05-06 00:00:00 UTC
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Why Appian, Datadog, and Beyond Meat Stocks Took a Hit Today
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DDOG
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https://www.nasdaq.com/articles/why-appian-datadog-and-beyond-meat-stocks-took-a-hit-today-2021-05-06
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What happened
Shares of low-code automation specialist Appian (NASDAQ: APPN), monitoring and analytics platform provider Datadog (NASDAQ: DDOG), and plant-based meat company Beyond Meat (NASDAQ: BYND) were all hit hard on Thursday. The stocks slid as much as 7.2%, 9%, and 5%, respectively. As of 11:45 a.m. EDT, however, they had recovered and were down 2.6%, 7.8%, and 2.7%, respectively.
The three stocks' declines come as many growth stocks continue to get pummeled this week.
In addition, some investors may be trying to de-risk their portfolios from further potential declines since all three of these companies report their quarterly results after market close today. While it's possible that their shares could rise following their quarterly reports, the market hasn't been kind to very many growth stocks recently following their earnings reports. Some investors, therefore, may be fearful going into this afternoon's updates.
Image source: Getty Images.
So what
Many growth stocks like Appian, Datadog, and Beyond Meat have been taking a beating recently as profit-taking accelerates following an extraordinary year. Throughout 2020 and into the beginning of 2021, many growth stocks surged as tech-driven business models benefited from lockdowns that had consumers more reliant than ever on technology.
Though Beyond Meat is the exception among these three companies, in the fact that its stock didn't rise sharply in 2020, it is largely viewed as a growth stock. So it's not surprising to see the stock getting lumped in with this recent sell-off.
Now what
On average, analysts are expecting Appian's revenue to grow 17.4% year over year to $82.7 million. Impressively, this growth rate would be in line with the company's 17% revenue growth in the fourth quarter of 2020.
For the full year, Appian management recently said, it expects total revenue to grow at a rate between 4% and 5%. Investors should look to see if this figure gets updated when earnings are released today.
The consensus analyst estimate for Datadog's first-quarter revenue growth rate is 42.3% -- a deceleration from 56% growth in the fourth quarter of 2020. "We believe our already strong market position will only be strengthened longer-term by the pandemic," CEO Olivier Pomel said in the company's fourth-quarter earnings release in February, "as the needs to be digital-first and agile are more prominent than ever."
Analysts are modeling for 17.1% year-over-year revenue growth at Beyond Meat. This translates to an expectation for quarterly revenue of $114 million. This would mark a significant acceleration from 3.5% revenue growth in the fourth quarter of 2020, when the company's foodservice channel weighed on results with its 43% year-over-year decline in revenue due to the negative impact of COVID-19 on foodservice demand.
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Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends Appian, Beyond Meat, Inc., and Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of low-code automation specialist Appian (NASDAQ: APPN), monitoring and analytics platform provider Datadog (NASDAQ: DDOG), and plant-based meat company Beyond Meat (NASDAQ: BYND) were all hit hard on Thursday. In addition, some investors may be trying to de-risk their portfolios from further potential declines since all three of these companies report their quarterly results after market close today. So what Many growth stocks like Appian, Datadog, and Beyond Meat have been taking a beating recently as profit-taking accelerates following an extraordinary year.
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What happened Shares of low-code automation specialist Appian (NASDAQ: APPN), monitoring and analytics platform provider Datadog (NASDAQ: DDOG), and plant-based meat company Beyond Meat (NASDAQ: BYND) were all hit hard on Thursday. In addition, some investors may be trying to de-risk their portfolios from further potential declines since all three of these companies report their quarterly results after market close today. Now what On average, analysts are expecting Appian's revenue to grow 17.4% year over year to $82.7 million.
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What happened Shares of low-code automation specialist Appian (NASDAQ: APPN), monitoring and analytics platform provider Datadog (NASDAQ: DDOG), and plant-based meat company Beyond Meat (NASDAQ: BYND) were all hit hard on Thursday. While it's possible that their shares could rise following their quarterly reports, the market hasn't been kind to very many growth stocks recently following their earnings reports. Though Beyond Meat is the exception among these three companies, in the fact that its stock didn't rise sharply in 2020, it is largely viewed as a growth stock.
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What happened Shares of low-code automation specialist Appian (NASDAQ: APPN), monitoring and analytics platform provider Datadog (NASDAQ: DDOG), and plant-based meat company Beyond Meat (NASDAQ: BYND) were all hit hard on Thursday. So what Many growth stocks like Appian, Datadog, and Beyond Meat have been taking a beating recently as profit-taking accelerates following an extraordinary year. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Appian wasn't one of them!
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718868.0
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2021-05-03 00:00:00 UTC
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Why Datadog Stock Fell Sharply on Monday
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DDOG
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https://www.nasdaq.com/articles/why-datadog-stock-fell-sharply-on-monday-2021-05-03
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What happened
Shares of monitoring and analytics platform provider Datadog (NASDAQ: DDOG) were hit hard on Monday, declining 6.5% by the time the market closed.
The stock was down likely for two primary reasons. First, many growth stocks like Datadog fell several percentage points or more on Monday. Second, RBC Capital analyst Matthew Hedberg lowered his 12-month price target on the stock.
Image source: Getty Images.
So what
Many growth stocks are down sharply from levels in January and early February. Datadog is no exception -- and pricing pressure on these stocks persisted on Monday. The market seems to have been taking profits on lots of growth stocks after their huge gains last year.
RBC Capital's Hedberg reduced his price target for Datadog stock from $120 to $105, citing multiple compression in the valuations of many of Datadog's industry peers.
Now what
Despite Hedberg's lowered price target for the stock, the analyst is optimistic about Datadog's underlying business, noting that he expects the company to report strong first-quarter performance, particularly when it comes to its cloud adoption.
Datadog reports its first-quarter results after market close this Thursday.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Datadog. His clients may own shares of the companies mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of monitoring and analytics platform provider Datadog (NASDAQ: DDOG) were hit hard on Monday, declining 6.5% by the time the market closed. Now what Despite Hedberg's lowered price target for the stock, the analyst is optimistic about Datadog's underlying business, noting that he expects the company to report strong first-quarter performance, particularly when it comes to its cloud adoption. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.
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What happened Shares of monitoring and analytics platform provider Datadog (NASDAQ: DDOG) were hit hard on Monday, declining 6.5% by the time the market closed. Second, RBC Capital analyst Matthew Hedberg lowered his 12-month price target on the stock. RBC Capital's Hedberg reduced his price target for Datadog stock from $120 to $105, citing multiple compression in the valuations of many of Datadog's industry peers.
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What happened Shares of monitoring and analytics platform provider Datadog (NASDAQ: DDOG) were hit hard on Monday, declining 6.5% by the time the market closed. RBC Capital's Hedberg reduced his price target for Datadog stock from $120 to $105, citing multiple compression in the valuations of many of Datadog's industry peers. 10 stocks we like better than Datadog When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen.
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What happened Shares of monitoring and analytics platform provider Datadog (NASDAQ: DDOG) were hit hard on Monday, declining 6.5% by the time the market closed. First, many growth stocks like Datadog fell several percentage points or more on Monday. Now what Despite Hedberg's lowered price target for the stock, the analyst is optimistic about Datadog's underlying business, noting that he expects the company to report strong first-quarter performance, particularly when it comes to its cloud adoption.
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718869.0
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2021-05-01 00:00:00 UTC
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Got $10,000 and 10 Years to Wait? These 3 High-Growth Stocks Are Just Getting Started
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DDOG
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https://www.nasdaq.com/articles/got-%2410000-and-10-years-to-wait-these-3-high-growth-stocks-are-just-getting-started-2021
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There's little doubt that the best path to generating long-term wealth is investing in quality companies and holding them for years, if not decades. Achieving even an "average" stock market return still easily eclipses the rates offered by your neighborhood savings and loan. However, investors that are willing to do their homework can achieve significantly greater returns, hastening them along their path to financial independence.
Finding stocks with the right combination of a market-leading position, secular tailwinds, and a large and growing market can result in game-changing returns.
If you've got a sufficient emergency fund and $10,000 (or less) that you don't expect to need over the coming five to 10 years, here are three stocks that fit those lofty criteria.
Image source: Getty Images.
Twilio: Making in-app communications a breeze
An important lesson that was hammered home during the pandemic is the importance of keeping the lines of communications open. Whether customers want to call, text, or chat, making the process as seamless as possible can be the difference between success and failure. That's where Twilio (NYSE: TWLO) comes in.
The company provides communication technology that developers can embed directly into their own apps, without having to reinvent the wheel. Twilio's communications platform-as-a-service (CPaaS) is the industry standard, working behind the scenes to facilitate the processing of phone calls, texts, video, and chats -- all without ever leaving the app.
If you've ever experienced the real-time messages sent by food delivery services and rideshare providers, the text prompts to help reset your password, and the in-app conversations with customer service, chances are good they were powered by Twilio's technology.
Revenue growth accelerated in each of the past three quarters, capping off a stellar year for Twilio. Revenue jumped 65% year over year in the fourth quarter, while climbing 55% during 2020. The company's growing customer base helped fuel the results, climbing to 221,000, up 23% year over year. Not only that, but Twilio was able to expand its relationship with existing customers, as evidenced by its dollar-based net expansion rate of 139%.
Twilio isn't stopping there. Late last year, the company acquired Segment, expanding its footprint into customer engagement services. The move also significantly expanded the company's total addressable market (TAM), which management now estimates at $79 billion. Considering Twilio's full-year revenue in 2020 topped out at $1.76 billion, the company has a long runway for growth ahead.
Image source: Getty Images.
Roku: The future will be streamed
Streaming video pioneer Roku (NASDAQ: ROKU) was already scaling rapidly before the pandemic kicked its growth into high gear. The company developed a strong following for its agnostic and user-friendly streaming platform, but it's the company's connected TV operating system (OS) that put the company within reach of every living room in America. In fact, the Roku OS was found in 38% of smart TVs sold in the U.S. last year, while boasting a 31% market share in Canada.
The focus on growing its user base is bearing fruit. Roku's active accounts climbed to 51.2 million in the fourth quarter, making it the largest streaming platform in the U.S., outpacing Amazon's (NASDAQ: AMZN) Fire TV with 50 million. More importantly, Roku's growth is accelerating just as Amazon's is slowing, with year-over-year growth rates of 39% and 25%, respectively. With more than 10,000 streaming channels to choose from, Roku has something for every viewer, and this has customers flocking to its platform in record numbers.
It's important to note that Roku makes the lion's share of its revenue from digital advertising. The company gets as much as 30% of the advertising that appears on the ad-supported channels on its platform. Additionally, when a customer signs up for a streaming service on its platform, Roku gets a cut of the subscription.
Business is booming. While total revenue grew 58% year over year, platform revenue -- which includes revenue from digital advertising, The Roku Channel, and the licensing of its OS -- soared 81%, the highest growth rate since Q2 19. Its average revenue per user (ARPU) continues to grow at a healthy clip, up 24% year over year.
Roku is expanding its already sizable opportunity with the recent acquisition of Nielsen's Advanced Video Advertising business, which helps the company digitally replace the advertising from broadcast television feeds with more targeted spots. The move expanded Roku's estimated addressable market, which is projected to eclipse $769 billion by 2024. Considering Roku's revenue topped out at $1.78 billion last year, this could be just the tip of the iceberg.
Image source: Getty Images.
Datadog: A watchful eye in the cloud
There's little doubt the adoption of cloud computing accelerated over the past year, giving the digital transformation a big push forward. Monitoring these cloud-based systems has taken on greater importance than ever before, and extracting meaningful and actionable information is a key component of success. That's where Datadog (NASDAQ: DDOG) comes in.
The cloud-native platform-as-a-service (PaaS) provider gathers data from across a company's cloud operations, breaking down silos and compiling information neatly into a single dashboard. It also monitors both employee- and customer-facing systems to detect problems before they become critical and alerting developers to take remedial action. This can help prevent crucial and costly downtime.
Perhaps that's why Datadog was selected as a top choice for application performance monitoring by research company Gartner, which named the company one of the "Visionaries" for 2020 in its Magic Quadrant. Datadog was also recognized by developers in the 2020 Gartner Peer Insights Customers' Choice for Application Performance Monitoring, achieving a rating of 4.6 of 5 stars.
The respect of developers has helped fuel Datadog's reputation, as well as its financial results. The company's fourth-quarter revenue grew 56% year over year, and Datadog is edging ever closer to consistent profitability. The results were driven by robust customer metrics. Customers delivering annual recurring revenue (ARR) of $1 million or more grew 94% year over year, while those with ARR of $100,000 grew 46%.
Datadog is adding to its suite of services with the recent acquisition of Sqreen, which helps companies detect and block app-level attacks. The company also acquired Timber Technologies, which provides a single dashboard to collect observability data in one place. These acquisitions add to Datadog's large and growing addressable market, which management recently pegged at roughly $44 billion. The company generated revenue of $604 million last year, giving Datadog plenty of opportunity for growth ahead.
Data by YCharts
A word on valuation
Each of these three stocks has beaten the broader market by a significant margin over the past year, but the best could be yet to come. As such, each commands a premium valuation. Twilio, Roku, and Datadog are selling at 34, 28, and 18 times forward sales, respectively -- when a good price-to-sales ratio is generally between 1 and 2. It's also worth noting that none of these companies is consistently profitable, though Roku was in the black in each of the two preceding quarters.
Thus far, however, investors have been willing to pony up for the combination of market leading position, impressive top-line growth, and massive addressable markets. Given the size of the opportunities that remain, these high-growth stocks are likely just getting started.
10 stocks we like better than Roku
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Roku wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Danny Vena owns shares of Amazon, Datadog, Roku, and Twilio. The Motley Fool owns shares of and recommends Amazon, Datadog, Roku, and Twilio. The Motley Fool recommends Gartner and recommends the following options: long January 2022 $1920.0 calls on Amazon and short January 2022 $1940.0 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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That's where Datadog (NASDAQ: DDOG) comes in. Twilio's communications platform-as-a-service (CPaaS) is the industry standard, working behind the scenes to facilitate the processing of phone calls, texts, video, and chats -- all without ever leaving the app. The cloud-native platform-as-a-service (PaaS) provider gathers data from across a company's cloud operations, breaking down silos and compiling information neatly into a single dashboard.
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That's where Datadog (NASDAQ: DDOG) comes in. The company's growing customer base helped fuel the results, climbing to 221,000, up 23% year over year. While total revenue grew 58% year over year, platform revenue -- which includes revenue from digital advertising, The Roku Channel, and the licensing of its OS -- soared 81%, the highest growth rate since Q2 19.
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That's where Datadog (NASDAQ: DDOG) comes in. The company's growing customer base helped fuel the results, climbing to 221,000, up 23% year over year. While total revenue grew 58% year over year, platform revenue -- which includes revenue from digital advertising, The Roku Channel, and the licensing of its OS -- soared 81%, the highest growth rate since Q2 19.
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That's where Datadog (NASDAQ: DDOG) comes in. The company's growing customer base helped fuel the results, climbing to 221,000, up 23% year over year. While total revenue grew 58% year over year, platform revenue -- which includes revenue from digital advertising, The Roku Channel, and the licensing of its OS -- soared 81%, the highest growth rate since Q2 19.
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e68004f5-757e-4503-be14-e76f86f82a9b
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718870.0
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2021-04-28 00:00:00 UTC
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5 Ultra-Popular Growth Stocks With 28% to 56% Upside, According to Wall Street
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DDOG
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https://www.nasdaq.com/articles/5-ultra-popular-growth-stocks-with-28-to-56-upside-according-to-wall-street-2021-04-28
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For 13 months, Wall Street has proved virtually unstoppable. Since hitting a bear market bottom on March 23, 2020, the broad-based S&P 500 has galloped higher by 87%, through this past weekend. This handily outpaces the average bounce-back rally from a bear-market bottom and leaves the historic average annual return for the benchmark index eating dust.
Yet even at these lofty levels, Wall Street professionals see value. Based on the consensus one-year price targets of Wall Street analysts, five of the most popular growth stocks offer implied upside ranging from a low of 28% to as much as 56%.
Image source: Getty Images.
Shopify: Implied upside of 31%
First up is my absolute favorite software-as-a-service (SaaS) stock, Shopify (NYSE: SHOP). Even after gaining more than 1,000% over the past 3.5 years, Wall Street believes the company's stock offers an additional 31% upside to $1,434 a share over the next year.
Shopify's operating model of providing cloud-based e-commerce solutions to (primarily) small businesses couldn't be in a better place at the moment. Although it was initially hit by the pandemic with virtually all other retail-oriented companies, it quickly became apparent that Shopify's e-commerce platform would be a logical beneficiary as businesses shifted course and pushed online. The result was a 96% increase in gross merchandise value (GMV) transacted across its platform in 2020 to $119.6 billion. Over the past six years, GMV has grown at a compound annual rate of 77.7%.
What's made Shopify tick is both the discovery of the platform by new merchants and the ability to snag worthwhile deals with major retailers. The number of consumers using the platform increased by approximately 52% last year to 457 million. Meanwhile, it partnered with the likes of Walmart and Pinterest to streamline aspects of their online sales platforms.
Shopify isn't remotely inexpensive on a fundamental basis. But if it can continue to grow its GMV at these insane levels, investors will gladly pay a hefty premium to own Shopify stock.
Image source: Getty Images.
Teladoc Health: Implied upside of 40%
Telemedicine giant Teladoc Health (NYSE: TDOC) has been exceptionally popular over the past year, for obvious reasons I'll touch on in a moment. According to Wall Street, shares of Teladoc could ascend past $250 over the next 12 months, giving it an implied upside of 40%.
As you can imagine, physicians wanted to keep at-risk people and potentially infected patients out of offices and hospitals if at all possible last year. This led to Teladoc handling almost 10.6 million virtual visits in 2020, up from around 4.1 million in the previous year.
But understand that telehealth is a game-changing healthcare model and not just a one-year wonder because of the pandemic. It's far more convenient for patients, allows physicians to keep closer tabs on at-risk patients, and is usually billed at a lower rate than office visits, which health insurers love. These advantages are exactly why Teladoc's sales grew by an average annual rate of 74% between 2013 and 2019.
Furthermore, Teladoc has a new toy, so to speak: It acquired leading applied health signals company Livongo Health in early November. Livongo leans on artificial intelligence to send tips and nudges to patients with chronic illnesses. These nudges help patients make behavioral changes that result in their leading healthier lives. The addition of Livongo makes Teladoc a veritable no-brainer buy.
Image source: Getty Images.
Snowflake: Implied upside of 28%
Another high-growth stock with abundant upside according to Wall Street professionals is cloud data warehousing company Snowflake (NYSE: SNOW). After recently retracing to an all-time low, analysts see Snowflake gaining up to 28% to almost $301 a share over the next 12 months.
As I alluded to with Shopify, we're witnessing a big push by businesses online and into the cloud, which has been a boon for most cloud infrastructure companies. Despite the worst economic downturn in decades, Snowflake grew its product revenue by 120% to $553.8 million in fiscal 2021. Although it's losing a lot of money at the moment, the services Snowflake offers should yield juicy margins as the company matures.
Arguably the most interesting thing about Snowflake is its sustainable competitive advantages. For instance, it offers a pay-as-you-go model that shuns the subscriptions that SaaS stocks often covet. By allowing its customers to pay based on their storage needs and Snowflake Compute Credits used, it's offering a highly transparent and cost-effective operating model.
Even better, its platform is layered atop the most popular cloud infrastructure solutions, which makes the sharing of information seamless, regardless of storage provider.
Snowflake has some very big shoes to fill with its lofty valuation, but Wall Street believes the company can get it done.
Image source: Getty Images.
Datadog: Implied upside of 35%
Have I mentioned that Wall Street has a thing for SaaS stocks? In addition to Shopify and Snowflake, analysts believe that application monitoring solutions provider Datadog (NASDAQ: DDOG) could surge to $121 a share over the next year. This implies up to 35% upside in its shares.
Keeping with the theme, Datadog looks to benefit from businesses completely shifting their strategy in the wake of the pandemic. With employees working remotely, it's become more important than ever that businesses stay on top of key metrics, oversee critical applications, and fully understand the behavior of their customers. Datadog's cloud-based solutions do all of this for its clients.
What's been most impressive about Datadog is the company's ability to attract bigger clients. While a 46% increase in customers with at least $100,000 in annual recurring revenue (ARR) is nice, the "wow" number is the 94% increase in the number of customers generating at least $1 million in ARR. This is a big reason the company's sales shot 66% higher in 2020 to $603.5 million.
Similar to Snowflake, Datadog has a lot to prove with its lofty price-to-sales ratio. However, if it can continue to grow its sales by more than 30% annually, there's no reason Wall Street's price target isn't within reach.
Image source: Getty Images.
Coinbase: Implied upside of 56%
Finally, recent initial public offering Coinbase (NASDAQ: COIN) offers the highest perceived upside among these five fast-growing companies. Though there were only four price targets listed through this past weekend, a lofty target of $600 a share skewed the consensus up to $456 a share. This suggests Coinbase could gain 56% over the coming 12 months.
There's no doubt that Coinbase has benefited from the euphoria surrounding cryptocurrencies like Bitcoin and Ethereum. With both rallying to new highs this year, Coinbase recorded $1.8 billion in revenue in the first quarter. For some context, that's more revenue than it had generated in the previous 24 months combined!
However, unlike the other popular companies listed here, Coinbase's advantages look flimsy, at best. It runs the risk of competing crypto brokerages undercutting its fees, which could reduce its operating margins and growth rate dramatically over time.
Furthermore, its business model looks to be built upon euphoria rather than innovation. With most of its revenue coming from Bitcoin and Ethereum trading, it's worrisome to see what happens when the price of these key assets stops rising. In a two-year stretch where Bitcoin lost 80% of its value, Coinbase saw its revenue nearly get halved.
In sum, Wall Street may be bullish on Coinbase, but this Fool isn't.
10 stocks we like better than Coinbase Global, Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Coinbase Global, Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Sean Williams owns shares of Pinterest and Teladoc Health. The Motley Fool owns shares of and recommends Bitcoin, Datadog, Pinterest, Shopify, Snowflake Inc., and Teladoc Health. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In addition to Shopify and Snowflake, analysts believe that application monitoring solutions provider Datadog (NASDAQ: DDOG) could surge to $121 a share over the next year. Based on the consensus one-year price targets of Wall Street analysts, five of the most popular growth stocks offer implied upside ranging from a low of 28% to as much as 56%. Although it was initially hit by the pandemic with virtually all other retail-oriented companies, it quickly became apparent that Shopify's e-commerce platform would be a logical beneficiary as businesses shifted course and pushed online.
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In addition to Shopify and Snowflake, analysts believe that application monitoring solutions provider Datadog (NASDAQ: DDOG) could surge to $121 a share over the next year. Even after gaining more than 1,000% over the past 3.5 years, Wall Street believes the company's stock offers an additional 31% upside to $1,434 a share over the next year. The Motley Fool owns shares of and recommends Bitcoin, Datadog, Pinterest, Shopify, Snowflake Inc., and Teladoc Health.
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In addition to Shopify and Snowflake, analysts believe that application monitoring solutions provider Datadog (NASDAQ: DDOG) could surge to $121 a share over the next year. Even after gaining more than 1,000% over the past 3.5 years, Wall Street believes the company's stock offers an additional 31% upside to $1,434 a share over the next year. Snowflake: Implied upside of 28% Another high-growth stock with abundant upside according to Wall Street professionals is cloud data warehousing company Snowflake (NYSE: SNOW).
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In addition to Shopify and Snowflake, analysts believe that application monitoring solutions provider Datadog (NASDAQ: DDOG) could surge to $121 a share over the next year. Even after gaining more than 1,000% over the past 3.5 years, Wall Street believes the company's stock offers an additional 31% upside to $1,434 a share over the next year. According to Wall Street, shares of Teladoc could ascend past $250 over the next 12 months, giving it an implied upside of 40%.
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718871.0
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2021-04-28 00:00:00 UTC
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Investing in These Stocks Now Could Make You a Millionaire Retiree
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DDOG
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https://www.nasdaq.com/articles/investing-in-these-stocks-now-could-make-you-a-millionaire-retiree-2021-04-28
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It's much better to be a millionaire retiree than a thousandaire one. You're probably not going to become one, though, unless you take some steps toward it. One good way is to regularly invest meaningful sums in the stock market, over a long period of time -- such as via a low-cost broad-market index fund.
If you want to try to get to millionairehood sooner, you might try investing in some carefully chosen individual stocks -- perhaps in addition to investing in index funds. Here are three growth stocks that have a lot of potential.
Image source: Getty Images.
1. Zscaler
Zscaler (NASDAQ: ZS) offers security technology for companies using various cloud services, and has been named the leader in secure web gateways by research firm Gartner. It has been growing briskly, with its stock increasing in value by more than sixfold over only about three years, since the company debuted on the public market. In its most recent quarter, revenue grew by 55% year over year, while billings jumped 71%. The company, recently sporting a market value near $26 billion, "reached a new milestone by surpassing 5,000 customers during the quarter, including 500 of the Global 2000." Between fiscal 2016 and 2020, revenue grew more than fivefold.
Zscaler has a "big, audacious goal" of reaching 200 million users and 100 million workloads, and in a presentation for investors, outlined a handful of growth drivers, such as upselling to existing customers, an increased presence in Japan and Latin America, and continuing technological innovations. The company has excelled at retaining customers and, indeed, at increasing the average amount they spend.
One concern about Zscaler for investors may be that it has been posting net losses, not net income, in recent years. But that's not unusual for younger, smaller companies. They tend to plow as many dollars as possible into furthering their growth.
2. Datadog
Software-as-a-service (SaaS) company Datadog (NASDAQ: DDOG) has been public for a shorter period than Zscaler. It debuted on the markets in September of 2019, closing at $37.55 per share on its first day, and it has more than doubled in value since then. Its market value recently sat at $27 billion.
So what does the company do? In its own words, it's a "monitoring and security platform for cloud applications," which helps companies
enable digital transformation and cloud migration, drive collaboration among development, operations, security and business teams, accelerate time to market for applications, reduce time to problem resolution, secure applications and infrastructure, understand user behavior, and track key business metrics.
Various applications have been added to its platform over time, making it even more powerful and attractive to potential customers, and more will be added. Its customers appear to be finding a lot to like in Datadog's offerings, as the company's retention rate was recently around 130%, suggesting not only that it retained most customers, but also that they increased their spending.
Datadog is growing rapidly, with revenue tripling between fiscal 2018 and 2020. Like Zscaler, it's posting losses while it invests in growth -- developing additional technologies, hiring more people, acquiring more customers, and ramping up its capabilities. Despite that, it's generating free cash flow, which bodes well for its financial health.
Image source: Getty Images.
3. Palo Alto Networks
Palo Alto Networks (NYSE: PANW) is a global leader in cybersecurity, with a market value recently near $35 billion. Clearly, threats from cyberspace are not going away anytime soon, and companies can't afford to have their systems hacked into and their safeguards breached. Enter Palo Alto, with technology, programs, and even consulting services to help companies secure their data and workings.
In the company's last reported quarter, revenue and billings jumped 25% and 22% year over year, respectively, topping management's previous guidance. Its growth drivers include its cloud-delivered security subscription offerings, which have gone from four to eight in just two years, and the newer, higher support level that it's offering customers -- "Platinum Support."
Palo Alto's artificial-intelligence-powered threat detection platform Cortex counts 66% of the Fortune 100 among its customers, plus 35% of the Global 2000. Interestingly, the company notes that "Cortex XDR's Behavioral Threat Protection instantly blocked a SolarStorm attack on Palo Alto Networks" and it sees the SolarStorm attack as a growth driver, as it generated more than 1,000 assessment requests related to it. CEO Nikesh Arora noted in a conference call:
This will result in more awareness and focus on cybersecurity, which in all candor, is the need of the hour given the complete reliance on technology in these times. We expect that this attack will be a wake-up call to all enterprises to modernize cybersecurity and will serve as a net incremental tailwind, not just for us but also for the industry.
These three companies are not selling at bargain-basement prices. But each appears to have a rosy future ahead of it. Consider digging more deeply into any of the companies that interest you, and if you like what you think, you might start a position in one or more by buying a few initial shares, and then add to that position over time. Or play it more conservative and just add the companies to your watch list, hoping for a lower price in the future (and knowing that it may or may not materialize).
Remember, too, that there are plenty of other terrific growth stocks out there, and many of them are trading at lower valuations.
10 stocks we like better than Palo Alto Networks
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
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Selena Maranjian owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog, Palo Alto Networks, and Zscaler. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog Software-as-a-service (SaaS) company Datadog (NASDAQ: DDOG) has been public for a shorter period than Zscaler. One good way is to regularly invest meaningful sums in the stock market, over a long period of time -- such as via a low-cost broad-market index fund. Like Zscaler, it's posting losses while it invests in growth -- developing additional technologies, hiring more people, acquiring more customers, and ramping up its capabilities.
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Datadog Software-as-a-service (SaaS) company Datadog (NASDAQ: DDOG) has been public for a shorter period than Zscaler. Zscaler Zscaler (NASDAQ: ZS) offers security technology for companies using various cloud services, and has been named the leader in secure web gateways by research firm Gartner. Palo Alto Networks Palo Alto Networks (NYSE: PANW) is a global leader in cybersecurity, with a market value recently near $35 billion.
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Datadog Software-as-a-service (SaaS) company Datadog (NASDAQ: DDOG) has been public for a shorter period than Zscaler. In its own words, it's a "monitoring and security platform for cloud applications," which helps companies enable digital transformation and cloud migration, drive collaboration among development, operations, security and business teams, accelerate time to market for applications, reduce time to problem resolution, secure applications and infrastructure, understand user behavior, and track key business metrics. Palo Alto Networks Palo Alto Networks (NYSE: PANW) is a global leader in cybersecurity, with a market value recently near $35 billion.
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Datadog Software-as-a-service (SaaS) company Datadog (NASDAQ: DDOG) has been public for a shorter period than Zscaler. Here are three growth stocks that have a lot of potential. So what does the company do?
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add58d73-3dcc-489f-85e1-0840e175999c
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718872.0
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2021-04-26 00:00:00 UTC
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Notable Monday Option Activity: DDOG, ODFL, LOPE
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DDOG
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https://www.nasdaq.com/articles/notable-monday-option-activity%3A-ddog-odfl-lope-2021-04-26
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 16,427 contracts have traded so far, representing approximately 1.6 million underlying shares. That amounts to about 48.9% of DDOG's average daily trading volume over the past month of 3.4 million shares. Particularly high volume was seen for the $100 strike call option expiring April 30, 2021, with 2,745 contracts trading so far today, representing approximately 274,500 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $100 strike highlighted in orange:
Old Dominion Freight Line, Inc. (Symbol: ODFL) saw options trading volume of 3,273 contracts, representing approximately 327,300 underlying shares or approximately 48.6% of ODFL's average daily trading volume over the past month, of 672,845 shares. Particularly high volume was seen for the $250 strike put option expiring May 21, 2021, with 1,008 contracts trading so far today, representing approximately 100,800 underlying shares of ODFL. Below is a chart showing ODFL's trailing twelve month trading history, with the $250 strike highlighted in orange:
And Grand Canyon Education Inc (Symbol: LOPE) saw options trading volume of 1,151 contracts, representing approximately 115,100 underlying shares or approximately 48% of LOPE's average daily trading volume over the past month, of 239,620 shares. Especially high volume was seen for the $125 strike call option expiring May 21, 2021, with 329 contracts trading so far today, representing approximately 32,900 underlying shares of LOPE. Below is a chart showing LOPE's trailing twelve month trading history, with the $125 strike highlighted in orange:
For the various different available expirations for DDOG options, ODFL options, or LOPE options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $100 strike call option expiring April 30, 2021, with 2,745 contracts trading so far today, representing approximately 274,500 underlying shares of DDOG. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 16,427 contracts have traded so far, representing approximately 1.6 million underlying shares. That amounts to about 48.9% of DDOG's average daily trading volume over the past month of 3.4 million shares.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $100 strike highlighted in orange: Old Dominion Freight Line, Inc. (Symbol: ODFL) saw options trading volume of 3,273 contracts, representing approximately 327,300 underlying shares or approximately 48.6% of ODFL's average daily trading volume over the past month, of 672,845 shares. Below is a chart showing LOPE's trailing twelve month trading history, with the $125 strike highlighted in orange: For the various different available expirations for DDOG options, ODFL options, or LOPE options, visit StockOptionsChannel.com. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 16,427 contracts have traded so far, representing approximately 1.6 million underlying shares.
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Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 16,427 contracts have traded so far, representing approximately 1.6 million underlying shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $100 strike highlighted in orange: Old Dominion Freight Line, Inc. (Symbol: ODFL) saw options trading volume of 3,273 contracts, representing approximately 327,300 underlying shares or approximately 48.6% of ODFL's average daily trading volume over the past month, of 672,845 shares. That amounts to about 48.9% of DDOG's average daily trading volume over the past month of 3.4 million shares.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $100 strike highlighted in orange: Old Dominion Freight Line, Inc. (Symbol: ODFL) saw options trading volume of 3,273 contracts, representing approximately 327,300 underlying shares or approximately 48.6% of ODFL's average daily trading volume over the past month, of 672,845 shares. Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Datadog Inc (Symbol: DDOG), where a total of 16,427 contracts have traded so far, representing approximately 1.6 million underlying shares. That amounts to about 48.9% of DDOG's average daily trading volume over the past month of 3.4 million shares.
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c1d3094b-9510-47dc-bbf9-3c4c3236111d
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718873.0
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2021-04-21 00:00:00 UTC
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A Deep Dive Into UiPath
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DDOG
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https://www.nasdaq.com/articles/a-deep-dive-into-uipath-2021-04-21
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In this episode of Industry Focus: Tech, host Dylan Lewis and Motley Fool contributor Brian Feroldi talk about UiPath (NASDAQ:PATH) and how it serves the robotic process automation market, the insane growth rates the business is posting, and why it reminds them of recent IPO Snowflake (NYSE: SNOW).
Editor's note: This podcast was recorded before UiPath started trading on Wednesday, April 21.
To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.
10 stocks we like better than Walmart
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David and Tom just revealed what they believe are the ten best stocks for investors to buy right now… and Walmart wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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Stock Advisor returns as of 2/1/20
This video was recorded on April 9, 2021.
Dylan Lewis: It's Friday, April 9, and we're talking about an automation S-1. I'm your host, Dylan Lewis, I am joined by fool.com's uniquely unqualified underwriter for uncovering anti-underperforming utility units, Brian Feroldi. Brian, how are you doing?
Brian Feroldi: Dylan, happy Friday to you. How is it going?
Lewis: I can't complain, man, we get to do this all the time. It's so fun to tape the show with you and we got a prospectus on our hands. There has been no shortage of really interesting companies. I don't want to overstate it, but I think that the one that we're going to be talking about today, based on that alliterative, people can tell it starts with a U. Probably one of the more interesting ones and maybe one of the most immediately investable ideas we've talked about in awhile.
Feroldi: Yeah. When I dug through the S-1 on this company, there is definitely a lot to like, and you called this out in a private conversation we had: You think this could be Snowflake 2.0. Given the numbers we're about to say, I don't think that's an unfair comparison.
Lewis: Enough intrigue. The name of the company is UiPath and the proposed ticker symbol is PATH. If you're in the tech business, UiPath might make sense to you as a name; it plays into what they do. But Brian, this is a company that is focused on robotic process automation. It's probably a little jargon heavy for some of our listeners.
Feroldi: That absolutely is. Let's start with the company's mission that always should give you a good idea of what the company's trying to do. UiPath's mission is "To unlock human creativity and ingenuity by enabling the fully automated enterprise and empowering workers through automation." In very simple terms, they provide automated software solutions that can be deployed and used by non-technical people or, to say even simpler, they make software robots so that people don't have to be robots.
Lewis: Yeah, it's kind of interesting to think of people as robots. That might cause some people's brains to hurt a little bit with that classification. But I think breaking it down is helpful: RPA, the robotic process automation that they are focused on. This is really the core business and the enterprise issue that they are trying to solve. I want to get definitional here because I think it helps clarify what this is. If you break this down, we have robotics, this is something that is capable of being programmed by a computer to do a task; you have a process, which is a series of steps that lead to an activity; and you have automation, which is when a task happens without any human interaction. If you put all of those together, you are taking something that's capable of doing something automatically, laying out the steps for how it does it automatically, and then allowing it to automatically happen without any human intervention. When we do this, Brian, we're primarily focusing on very rote automated tasks that have been worked out in all of the workflows that have been figured out.
Feroldi: Yes. I think that everybody here, even if you're a knowledge worker, does have some repetitive tasks in their jobs: filling out forms, pulling in data, integrating information, etc. There are still a ton of repetitive tasks that knowledge workers do that don't necessarily add a lot of value. UiPath's goal is to create easy-to-use software robots that can be deployed by essentially anybody in an organization to take the automated mundane tasks out of their lives so they can focus on higher quality work.
Lewis: Yeah. I think if you are having a hard time understanding how this might come together for an office worker, if there's anything that you are manually copying and pasting or taking from one form and putting into another system, those are precisely the tasks that RPA can help out with.
Feroldi: Yeah, exactly. What's notable here is that this company has a lot of third-party industry rankings that really point out that it is the leader in the industry. If you look at Gartner, they call out UiPath as the top dog in RPA; Forrester calls out UiPath as the clear leader in the industry. Those are some heavy hitters that are backing this company up.
Lewis: As we often say, Brian, when we kind of get what a business does but maybe don't quite have a good grip on the technical elements, we always like to see the industry endorsements. That always helps us and gives us a little bit of confidence.
Feroldi: That and the numbers, too. We usually [laughs] let the numbers do the talking and we'll get into that in a little bit. But if you talk about this company's actual solutions, yes, in their S-1, they have all the buzz words that are meaningful today. Yes, they say AI, machine learning, API integration, or low-code automation, etc. But they have a number of products that can basically be broken down into seven primary automation functions.
The first one would be what they call discovery. This is when they use AI tools and desktop recording to find repetitive tasks that are being done by knowledge workers that robots could do. The second bucket is products that build the tools that actually handle the coding. The third is a group that is called management and that's where the tools can be tested and deployed. Fourth is the runtime. The actual running of the tools themselves, so that it all happens behind the scenes. Fifth would be engagement, and this is actually a key point here. These tools aren't necessarily just to replace the tasks that humans do but also to augment them. UiPath wants its robots and humans to co-exist together so that they can complement each other. That's what the engagement function does. Sixth would be measurement. It's important to have feedback and analytics to make sure that you can actually have numbers to back up that these tools are helping you and making you more productive. The seventh would be a government to make sure that everything is safe, secure, and making sure that access is restricted. So that is, broadly speaking, the seven categories that UiPath breaks up its tools into.
Lewis: Yeah. Brian, I think if you're an outsider here, this can sound a little dystopian very fast. The idea of a robot for every human or heavily automating a lot of things that are currently being done by workers. And I want to circle back to the mission here for a second for the company because I think it's crucial in how they're positioning themselves with their customers. They say, again, to unlock human creativity and ingenuity by enabling fully automated enterprise and empowering workers through automation. Then, the interviews that I have seen with their CEO, for the most part, the focus is we are removing things that are boring, rote, difficult because they are so manual and could be automated. The goal being we want to free up more of the creative work, more of the moments where humans really can add value to something within normal workflows. That's analysis. In some cases, that's creative work. But the pitch from this company is we are not replacing people. We are trying to free them up to do work that is a little bit more filling and also where they're more valuable, honestly.
Feroldi: The pitch from UI is, essentially, we want to give every single employee that you have an assistant that can handle all of their mundane tasks, which can free up your employees to do other things. At least, that's the pitch at a very high level.
Lewis: Yeah. Now, I mean, when you get more efficient, that does mean often more work wants to come in your way. I think some of the concerns are warranted, but that's at least how they're angling themselves. Yeah, I think the assistant is a very helpful metaphor for thinking about how this company is positioning itself for customers and really how users can think about it.
Feroldi: Now, this company was founded in 2005 and it's been deploying its solutions for more than 16 years. What I found interesting is that while this does have some SaaS-like qualities to it, it is not a pure-play SaaS company. They actually sell their software, both using a Software-as-a-Service model, as well as the legacy licensing model. If you look at their revenue from their most recent quarter, about 60% of their revenue comes from licensings. Those can be term deals where they have a start date and an end date or a perpetual where you just buy it and then you have it for that software as long as you want. That is still about 60% of total revenue. About 35% of this company's revenue is from a category that it just calls maintenance and support for their licenses. Finally, the final 5%, they do also have a professional services component. That is a loss leader for this company where they essentially send in consultants to their customers to help them get running, and the gross margin on that is actually negative. The benefit of using this model is that it can be completely adaptive to however the customer wants it. If the customer wants it all on the cloud, they can do that. If they want it all on-premise, they can do that. If they want a hybrid between the two, they can do that. If they want it in the private cloud or the public cloud or a combination, they can do that. UiPath really tries to meet the customer at the level that they want to be at.
Lewis: Yeah. I am glad you dug into the SaaS versus licensing here because it is easy to assume a lot of the companies we talk about, especially if they have a cloud element to them, default to SaaS, right? We've seen just how powerful the model is. We need to specifically highlight when that's not the case because we know it's a very attractive business model, and my hunch is we probably see SaaS as a much larger piece of the pie in the future for this company than it is currently. But that's, in some ways, an opportunity for them and something that they'll probably build into rather than how they're currently composed.
Feroldi: As much as we talk about the cloud and SaaS, Dylan, it's really amazing even still today how small SaaS is when compared to overall software usage licensing. I have no doubt that 10 years from today, almost everything will be SaaS and in the cloud, but for now, we're not quite there yet.
Lewis: I want to talk financials and give people a sense of the scope of this business because I'm guessing a lot of people have never even heard of the name UiPath. We talk about a lot of IPOs, our branding and marketing events. I think that's going to be the case for this business, but it is not a tiny one at this point, particularly when you think about the scope and all the companies they work with, but their top line is pretty sizable already.
Feroldi: In fiscal 2021, which was basically the year 2020, this company had a fabulous year or, should I say, another fabulous year. The top line grew 81% to $608 million. That is a very sizable number on its own right and equally impressive is that growth rate, 81%. I mean, that puts it in rare company. We're talking like CrowdStrike, Datadog, Shopify level, so a really impressive topline number.
Lewis: Yeah, and crucially, Brian, a lot of that money keeps flowing down to the bottom line. We see a gross margin with this business of 89%. Things get a little bit uglier when you go over to operating margin, as you might expect for a high-growth business. It's currently negative, but a lot of the core elements that we like in a business.
Feroldi: Totally. Yeah, the gross margin here was 89%, which is even more impressive when you consider that 5% of its revenue is negative gross margin, that percent, that professional services. That just shows you how unbelievably high-margin the software is. Net loss last year was $92 million at least on a GAAP basis. But if you look at free cash flow, free cash flow was actually positive $26 million, so that's just the difference between GAAP and the free cash flow. Financially, extremely strong. To your point, prior to coming public, the last balance sheet that we got from this company shows $474 million in cash, and they do have $1.2 billion in preferred common stock. More often than not, that does get converted to equity in an event such as an IPO. But yeah, there's no doubt that this company is extremely financially strong. Therefore, it's not coming public because it needs to. It's coming public because it wants to.
Lewis: Yeah. Brian, even further, if I'm not mistaken, the prospectus has the balance sheet as of Jan. 31, 2021. I know that they had a funding round. I believe it closed in early February. It might have been Feb. 1, which would mean that there is even more cash than what is currently shown on the balance sheet. Don't quote me on that, but I think it's true based on the timeline that I've seen with reports.
Feroldi: That will be fair enough. Either way, the company has plenty of capital, plenty of liquidity, but to your point I do think this is a marketing event for the company. The other number which I can't believe we've put this far down in the script, shame on us, UiPath has a net revenue retention rate that is ridiculously impressive: 145% -- and yes, retention that includes churn.
Lewis: Yeah. I think I can maybe come up with one or two other companies that have touched that with their prospectuses, and I think it's Datadog, maybe I don't even have a second one, Brian.
Feroldi: Yeah, that puts them in rare air, and equally it's important to remember what the scale we're talking about here. This is an upstart SaaS that is just getting started. This is a company that's been around for 15 years and is on pace to do over $600 million in revenue this year. That makes that number even more impressive.
Lewis: Yeah. And that timeline might be a little confusing to people, Brian, to hear this explosive growth and have never heard of this company. Part of it is I think UiPath for a while was trying to figure out what exactly the core business was. They went through a couple of different transformations and ultimately landed on RPA, realized by accident in some ways that they have a very effective product, and then focused their entire business on it and immediately became a category leader. That's why for as long as the company has been around, we're only seeing this massive growth really in like the last five or so years and really seeing it become a much more relevant industry player in the last decade or so.
Feroldi: And that's the thing that we see with a lot of successful companies. They start out with one idea in mind and they have to continually jig the business model until they hit upon something that really resonates with the market, and based on the numbers they've done just that.
Lewis: Yeah. If you look over a lot of industry lists, if the financials weren't enough, there are a lot of accolades. In April 2020, UiPath was named the top tech company and No. 2 overall in Financial Times, FT1000 ranking of America's Fastest-Growing businesses -- no surprise with that growth rate. UiPath was also named CNBC's 2020 disruptive 50 ranking and No. 3 on Forbes Cloud 100 for the second consecutive year. So a lot of people in the industry are watching this business, Brian.
Feroldi: Understandably, given the numbers that we're talking about as we said at the top of the show. It's going to be interesting to see what valuation this company pulls, and it would not be surprising at all if we saw Snowflake-like a day one results.
Lewis: Yeah. Just to give a quick history lesson on where they've been as a private company. They raised at a $1 billion valuation in 2018, and then $3 billion later in the same year; 2019 they raised at $7 billion, 2020 they raised at $10 billion, and earlier this year they raised $750 million in their Series F, which valued them at $35 billion. And so, Brian, that is a 30-bagger in about three years, which is absolutely wild.
Feroldi: It just shows you how crazy undervalued they were in 2018 when they raised that $1 billion. Yeah, if their private valuation is $35 billion, what kind of number are we going to possibly see first off at the IPO and then when so much trading actually starts. Snowflake was a few 100 times sales if memory serves. We're not anywhere in that ballpark but could we be? Maybe.
Lewis: It wouldn't be crazy. We're at basically 60 times trailing sales based on their most recent private valuation round. I have to imagine once we go through the actual public offering, the premium is going to be even higher. I wouldn't be shocked if it winds up touching triple-digits at some point, with a lot of market enthusiasm behind it. Part of that is, at least for Fools, there's another really strong sign with this one and that's the fact is this is a founder-led business.
Feroldi: The CEO and co-founder is still in the corner office. His name is Daniel Dines. He founded this business 16 years ago in Romania actually. All the usual checks that we go through really suggest that he has done a fabulous job. Not only has the growth been absolutely torrid, not only are they hiring new customers and getting existing ones to spend more. UiPath also gets pretty darn good Glassdoor reviews. If you look over Glassdoor, a few 100 people have given the CEO an 87% approval rating, the company itself gets four stars out of five. While we don't know the exact ownership or breakdown for this company, that will be jigged around based on how many shares it converted, etc. We do see that Daniel Dines owns 100% of the Class B stock for this company, that is super voting stock that we've seen go to many founders, and he basically owns 100% of that. Prior to coming public, he controls 91% of the total voting power of the company. So this is going to be his company, but you can't say that he doesn't have skin in the game because he is going to own a significant amount of this business.
Lewis: Yeah. It's hard to argue with the track record and the growth that we've seen so far. The more I read about this business, and you mentioned this when we talk about the revenue in the top line, the scale they're operating on -- the more I read the more I'm amazed that I didn't know about this company before you pinged me with the S-1 saying we'll talk about, because they have some huge partnerships and they have a huge customer base already.
Feroldi: Yeah, they've got almost 8,000 customers that they signed on. Yes, they are targeting enterprises and boy, have they landed some big ones. They claim to have 80% of the Fortune 10, 63% of the Fortune 500, and they have over 1,000 customers that will pay them over $100,000 at annual recurring revenue each year. This includes in their S-1 when they call it many big partners that we know, Adobe, Chevron, Chipotle, CrowdStrike, CBS, Takeda, Uber. A wide range of customers that are in all facets of the market.
Lewis: I'm going to add an asterisk. I think it's 80% of the Fortune 100, that might be a typo in our outline. Because that's the number that sticks out to me, but either way, we're talking about a huge imprint in what we know to be businesses that have a lot of spend and certainly companies that benefit tremendously from precisely what they're offering. It's a good sign for the industry and another proof-of-concept for them. In spite of all of that, having a huge customer base already, having massive contracts and installed basis in place already Brian, there's still a really compelling revenue opportunity in front of them.
Feroldi: IDC estimates that the market that this company competes in is currently worth about $17 billion. As a reminder, this company did about $600 million in revenue over the trailing 12 months. What's more important is that the entire market for the service is growing rapidly. IDC estimates that it's currently growing at about 16% annualized clip, so that's adding billions of dollars in TAM every year. If you look at the company, the company actually believes that that significantly understates its current market opportunity. It says if you look across the world at all the companies that have 200 employees or more that could potentially adopt our services, they believe that the TAM is currently $60 billion and growing rapidly. If you believe that, that means they've captured 1% of their current market opportunity. But if this company does not work out as an investment, it's not going to be because the opportunity isn't there.
Lewis: Yeah. There's clearly green field here in front of them. What I think is so encouraging when you see a business that already has a pretty big presence with companies that have a lot of spend and are willing to put money at ideas that make them more efficient is when you see such a strong dollar-base net retention number. Because that means the use case is there, once customers are in, they continue to grow and continue to find more ways to integrate this software solution into what they do on a day-to-day basis.
Feroldi: Exactly. If they can prove it out with a few employees and they can clearly get value, as we said at the top of the show, this is a company that wants essentially every knowledge worker to have their own robotic assistant. You could see that number continue to stay strong if they can deliver.
Lewis: Yeah. That is, as you might imagine, something that has attracted a lot of other people to this space. Anytime you see huge growth rates, people tend to perk up and say, maybe we should get into business doing that. Of course, UiPath was not the first company in this space. They came into something that already had some players and very quickly became one of the go-to providers. We did mention that they are one of the top dogs. I will say Automation Anywhere is another very highly regarded company in the space, and I think it's basically UiPath, Automation Anywhere, and then the rest of the field when you're looking certainly at industry rankings.
Feroldi: You shouldn't overlook, "the rest of the field," because that includes companies like Microsoft, Pegasystems, NICE Systems, SAP, WorkFusion, etc. But, yes. So far, UiPath has proven to be the top dog in this space, and as it's revenue growth improves, boy, is it doing a great job at maintaining that leadership position. That is absolutely a risk to watch, that if it's growth rates were to slow in the near future, that could be painful for shareholders.
Lewis: Brian, putting all this together, we have a company that we are loosely calling Snowflake 2.0. [laughs] And I think having gone through a lot of the core business numbers now, a lot of our listeners might even agree. This is a really compelling investing idea. High growth, great retention rates, interesting industry opportunity in front of them, founder-led business, seems like it has a really great culture. I think there's going to be a lot of enthusiasm behind this IPO, even though it's a name that a lot of people might not have heard of.
Feroldi: If you didn't know anything about the valuation, Dylan, is there a metric that we talked about that you did not like?
Lewis: No, it all looks great. [laughs] Even the gross margin, the growth rates, the [dollar-based net expansion rate]. It's all fantastic.
Feroldi: Exactly. Yes, this company checks all of the boxes that I look for. There's actually no customer concentration risk. We didn't actually get into that before, but man, is this a compelling investment. The tricky thing is going to be Wall Street is clearly onto this name and how big is the valuation for this company going to be after it becomes public? Man, was Snowflake priced at a very high number. There's no doubt in my mind that this thing is going to be too. If in the private markets it raised capital at 60 times sales, what's going to happen when they enter the public markets? This is definitely a company that I'm going to watch, I'm going to put it on my radar. I probably won't be a day one buyer, but would I be a quarter three or quarter four buyer? Maybe.
Lewis: Yeah. These are growth rates that are hard to ignore. I think there are probably some investors out there, Brian, that got bit a little bit by the enthusiasm behind Snowflake, where there was all of the fanfare around the IPO. We found out that Warren Buffett was an investor early, able to get in I think at IPO price. When you see Buffett getting into tech, [laughs] there's all kinds of excitement. That's such a signal for so many people. The shares are down, I think, about 30% from high or something like that. Anyone who's investing in that company is doing it because the long-term tailwinds are just so great and too big to ignore. But there might be a little bit more of a tepid reaction because of that. My guess is not, though. We tend to see people get really excited when something like this comes public.
Feroldi: Yeah, I'm looking at Snowflake's chart right now and it looks like they're down about 11% from their IPO price. Significantly more to that if you were unfortunate you have to buy at the high, because Snowflake actually performed pretty darn well after it came public. I never have a problem paying a very high valuation for a company, my problem is more just a pure market cap of this thing. Will this be a $100 billion company? Will it be a $70 billion company? Will it be a $50 billion company? That I don't know. I also don't know how big could this company become if everything just worked out beautifully. How much truly upside is there for investors? If I was going to take a position in a company like this, I would have to believe that multibagger returns are possible. Either way, it's definitely going on my watchlist.
Lewis: Yeah, same for me. And to your point, we know that this is going to be debuting in the tens of billions valuation. We've seen a lot of companies go from $50 billion to $300 billion, [laughs] and quality businesses seem to have a way of doing that. But it does mean that getting big fast is a little bit harder, and when you see growth rates like this that's a hockey-stick movement in its valuation over a very short period of time. I think it sets people up for really tough expectations when it comes to the performance of the company. Doesn't mean it's not a really high-quality business though.
Feroldi: Very high-quality business, and I understand why Wall Street is going to be excited about this thing. Hey, I'm happy we could talk about it today.
Lewis: Yeah. And you know what, Brian, if we see the news item that Warren Buffett winds up getting into UiPath, we will know that he is an Industry Focus listener.
Feroldi: [laughs] That's exactly right. Actually, I would vastly prefer to see Charlie Munger take the position in UiPath prior to coming public.
Lewis: [laughs] Brian, we'll have to keep our eyes peeled for that. Thank you so much for joining me on today's show.
Feroldi: Thank you, Dylan. Have a great weekend.
Lewis: You too. Listeners, that's going to do it for this episode of Industry Focus. If you have any questions or you want to reach out and say "Hey," shoot us an email at industryfocus@ fool.com, or you can always tweet us @MFIndustryFocus. If you want more of our stuff, subscribe on iTunes or wherever you get your podcast, Spotify, Stitcher. You name it, we are there. As always, people on the program may own companies discussed on the show, and The Motley Fool may have formal recommendations for or against stocks mentioned, so don't buy or sell anything based solely on what you hear. Thanks to Tim Sparks for all his work behind glass today, and thank you for listening. Until next time, Fool on!
Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Brian Feroldi owns shares of Adobe Systems, Chipotle Mexican Grill, Microsoft, and Shopify. Dylan Lewis owns shares of Shopify. The Motley Fool owns shares of and recommends Adobe Systems, Chipotle Mexican Grill, CrowdStrike Holdings, Inc., Datadog, Microsoft, Shopify, and Snowflake Inc.. The Motley Fool recommends Pegasystems, SAP SE, and Uber Technologies. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In this episode of Industry Focus: Tech, host Dylan Lewis and Motley Fool contributor Brian Feroldi talk about UiPath (NASDAQ:PATH) and how it serves the robotic process automation market, the insane growth rates the business is posting, and why it reminds them of recent IPO Snowflake (NYSE: SNOW). I think if you are having a hard time understanding how this might come together for an office worker, if there's anything that you are manually copying and pasting or taking from one form and putting into another system, those are precisely the tasks that RPA can help out with. What I think is so encouraging when you see a business that already has a pretty big presence with companies that have a lot of spend and are willing to put money at ideas that make them more efficient is when you see such a strong dollar-base net retention number.
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In this episode of Industry Focus: Tech, host Dylan Lewis and Motley Fool contributor Brian Feroldi talk about UiPath (NASDAQ:PATH) and how it serves the robotic process automation market, the insane growth rates the business is posting, and why it reminds them of recent IPO Snowflake (NYSE: SNOW). Brian Feroldi owns shares of Adobe Systems, Chipotle Mexican Grill, Microsoft, and Shopify. The Motley Fool owns shares of and recommends Adobe Systems, Chipotle Mexican Grill, CrowdStrike Holdings, Inc., Datadog, Microsoft, Shopify, and Snowflake Inc..
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In this episode of Industry Focus: Tech, host Dylan Lewis and Motley Fool contributor Brian Feroldi talk about UiPath (NASDAQ:PATH) and how it serves the robotic process automation market, the insane growth rates the business is posting, and why it reminds them of recent IPO Snowflake (NYSE: SNOW). Lewis: I want to talk financials and give people a sense of the scope of this business because I'm guessing a lot of people have never even heard of the name UiPath. The more I read about this business, and you mentioned this when we talk about the revenue in the top line, the scale they're operating on -- the more I read the more I'm amazed that I didn't know about this company before you pinged me with the S-1 saying we'll talk about, because they have some huge partnerships and they have a huge customer base already.
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Lewis: I want to talk financials and give people a sense of the scope of this business because I'm guessing a lot of people have never even heard of the name UiPath. So a lot of people in the industry are watching this business, Brian. Feroldi: Understandably, given the numbers that we're talking about as we said at the top of the show.
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5b7a7c28-21b6-4776-9b0e-226c915209ef
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718874.0
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2021-04-18 00:00:00 UTC
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These 3 Software Laggards Could Be Primed for a Q2 Bounceback
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DDOG
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https://www.nasdaq.com/articles/these-3-software-laggards-could-be-primed-for-a-q2-bounceback-2021-04-18
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nan
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nan
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During the first three months of 2021, a lot of tech stocks fell, or were stagnant, as investors looked to other sectors that they believed could outpace tech investments.
That short-term thinking by some investors has opened up buying opportunities for others. If you're looking for a few software stocks to add to your portfolio right now, here's why Zoom Video Communications (NASDAQ: ZM), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL) look like good buys right now.
Image source: Getty Images.
Repeat after me: Zoom is not just a coronavirus stock
Brian Withers (Zoom): It seems funny calling Zoom stock a laggard after its incredible run over the past year. But so far this year it's trailing the S&P 500 and down over 40% off its October 2020 high. The stock may have stalled, but there's still lots to love about this video conference call specialist.
Even as we enter the fourth quarter that the coronavirus has accelerated Zoom's growth, it is still putting up massive numbers all around.
METRIC
Q4 FY2020
Q3 FY2021
Q4 FY2021
QOQ CHANGE
YOY CHANGE
Revenue
$188 million
$777 million
$883 million
14%
369%
Customers >$100k annual spend
641
1,289
1,644
28%
156%
Net income
$11 million
$192 million
$256 million
33%
2,315%
Data source: Company earnings presentation. Note: Q4 FY2021 ended on Jan. 31, 2021. QOQ = quarter over quarter. YOY = year over year.
Large customer growth and top-line revenue are still hitting triple-digit year-over-year comps, and because of the company's ability to scale, its bottom line has skyrocketed. And yet, the stock is actually valued lower than it was before the coronavirus started. Today, the video conferencing specialist's price-to-sales ratio of 37 is more than 10% below where it was on March 1, 2020.
Investors may be worried about Zoom's ability to continue to put up solid growth numbers, but I'm not. Management has projected 42% year-over-year gains for the coming year and it has the growth levers to make it happen. Zoom Phones are flying off the shelves and are expected to be a $23 billion market by 2024. Zoom Rooms, which is the company's software solution for conference rooms using inexpensive commodity hardware, will enable companies to transition back to the workplace while allowing employees to continue to work from home. Lastly, its international business is still only a third of all revenue, growing at more than two times the rate of the Americas region.
Is Zoom set up to bounce back after its Q1, Q2, or second half of the year? No one can tell the future, but this company is executing at a high level and investors who get in today will be happy over the long run.
Image source: Getty Images.
Take this dog for a walk
Danny Vena (Datadog): The digital transformation was underway long before the pandemic, but the events of the past year have given things a big push forward. With more companies adopting the cloud than ever before, the strategic importance of keeping these systems up and running can't be overstated. Monitoring and maintaining both employee- and customer-facing systems to ensure they continue running smoothly and avoiding costly downtime is critical. That's where Datadog comes in.
The cloud-native service provider keeps a digital eye on cloud systems, assembling vital data into a single dashboard. It not only provides early warnings for developers if a problem could take down vital systems, but it also looks for anomalies that might foreshadow future issues.
Datadog has been cited for its application performance monitoring by research company Gartner, which named it a "Leader" for 2021 in its vaunted Magic Quadrant. The company was recognized for its "ability to execute" and "completeness of vision." Datadog was also cited by Forrester Research as a strong performer.
These industry accolades would be meaningless without strong financials to back them up -- and Datadog has that covered as well. Revenue grew 66% in 2020, while its adjusted earnings per share of $0.22 improved significantly from a $0.01 loss in 2019. The company is on the verge of consistent profitability, but Datadog generated free cash flow of $83 million during the year, illustrating the impact of non-cash charges.
At the same time, Datadog's client metrics are equally compelling. The company closed out the year with 1,253 customers with annual recurring revenue (ARR) of $100,000, an increase of 46% year over year, while customers with ARR of $1 million grew 94% to 97.
While Datadog has performed admirably over the past year, the stock was recently caught up in the downturn that hit high-growth and tech stocks, with no change in the thesis or opportunity. This means investors can get Datadog shares at a 20% discount to recent highs and the stock could come roaring back in the coming quarter.
Image source: Getty Images.
Don't overlook Apple's services opportunity
Chris Neiger (Apple): Apple has traditionally been known as a hardware company because it still makes a significant amount of its revenue (66% in the first quarter) from sales of its iPhones.
But the company's software, including Apple Fitness+, Apple Music, Apple TV+, Apple News+, and the App Store, is powering the company's fast-growing services segment. Apple's services are one of the company's next big areas of growth and the tech giant is already experiencing phenomenal results from the segment.
Services revenue grew 24% in the first quarter to $15.8 billion. This figure is even more impressive when you consider that in just three years Apple has increased its services revenue by 88%.
Investors can likely expect more year-over-year growth from the company's services segment in the upcoming second quarter, but it's the company's long-term prospects in the services market that investors should be focused on.
For example, Apple is reportedly working on a premium podcast subscription service that could launch later this year. The service could not only generate more revenue for Apple, but the company could potentially bundle a premium podcast subscription with other services to keep users further entwined into its ecosystem.
Additionally, a research note released by Loup Ventures earlier this year said that Apple could also release premium versions of its popular apps, including Maps, Health (an expanded version of Fitness+), Stocks, and even Mail.
While all of these ideas may not see the light of day, the fact is that Apple's services segment is already growing at a healthy clip, and any new services that Apple introduces will likely help accelerate that growth. In fact, some estimates put the value of Apple's services at around $1 trillion.
With Apple's stock making only modest gains in the first few months of this year, right now could be a good time to pick up some Apple shares as the company continues to expand its services footprint.
Find out why Zoom Video Communications is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
Tom and David just revealed their ten top stock picks for investors to buy right now. Zoom Video Communications is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of February 24, 2021
Brian Withers owns shares of Datadog and Zoom Video Communications. Chris Neiger owns shares of Apple. Danny Vena owns shares of Apple, Datadog, and Zoom Video Communications. The Motley Fool owns shares of and recommends Apple, Datadog, and Zoom Video Communications. The Motley Fool recommends the following options: long March 2023 $120.0 calls on Apple and short March 2023 $130.0 calls on Apple. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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If you're looking for a few software stocks to add to your portfolio right now, here's why Zoom Video Communications (NASDAQ: ZM), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL) look like good buys right now. Large customer growth and top-line revenue are still hitting triple-digit year-over-year comps, and because of the company's ability to scale, its bottom line has skyrocketed. Take this dog for a walk Danny Vena (Datadog): The digital transformation was underway long before the pandemic, but the events of the past year have given things a big push forward.
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If you're looking for a few software stocks to add to your portfolio right now, here's why Zoom Video Communications (NASDAQ: ZM), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL) look like good buys right now. Revenue $188 million $777 million $883 million 14% 369% Customers >$100k annual spend 641 1,289 1,644 28% 156% Net income $11 million $192 million $256 million 33% 2,315% Data source: Company earnings presentation. Don't overlook Apple's services opportunity Chris Neiger (Apple): Apple has traditionally been known as a hardware company because it still makes a significant amount of its revenue (66% in the first quarter) from sales of its iPhones.
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If you're looking for a few software stocks to add to your portfolio right now, here's why Zoom Video Communications (NASDAQ: ZM), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL) look like good buys right now. Don't overlook Apple's services opportunity Chris Neiger (Apple): Apple has traditionally been known as a hardware company because it still makes a significant amount of its revenue (66% in the first quarter) from sales of its iPhones. But the company's software, including Apple Fitness+, Apple Music, Apple TV+, Apple News+, and the App Store, is powering the company's fast-growing services segment.
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If you're looking for a few software stocks to add to your portfolio right now, here's why Zoom Video Communications (NASDAQ: ZM), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL) look like good buys right now. That's where Datadog comes in. But the company's software, including Apple Fitness+, Apple Music, Apple TV+, Apple News+, and the App Store, is powering the company's fast-growing services segment.
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16ff7dcf-d81a-450d-8887-86b81d115bbe
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718875.0
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2021-04-16 00:00:00 UTC
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Noteworthy Friday Option Activity: GM, DDOG, AXTA
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DDOG
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https://www.nasdaq.com/articles/noteworthy-friday-option-activity%3A-gm-ddog-axta-2021-04-16
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nan
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nan
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in General Motors Co (Symbol: GM), where a total volume of 89,743 contracts has been traded thus far today, a contract volume which is representative of approximately 9.0 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 44.2% of GM's average daily trading volume over the past month, of 20.3 million shares. Particularly high volume was seen for the $60 strike call option expiring April 16, 2021, with 10,747 contracts trading so far today, representing approximately 1.1 million underlying shares of GM. Below is a chart showing GM's trailing twelve month trading history, with the $60 strike highlighted in orange:
Datadog Inc (Symbol: DDOG) saw options trading volume of 16,304 contracts, representing approximately 1.6 million underlying shares or approximately 44.1% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Especially high volume was seen for the $92 strike call option expiring April 16, 2021, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $92 strike highlighted in orange:
And Axalta Coating Systems Ltd (Symbol: AXTA) options are showing a volume of 11,287 contracts thus far today. That number of contracts represents approximately 1.1 million underlying shares, working out to a sizeable 44% of AXTA's average daily trading volume over the past month, of 2.6 million shares. Especially high volume was seen for the $30 strike call option expiring April 16, 2021, with 7,640 contracts trading so far today, representing approximately 764,000 underlying shares of AXTA. Below is a chart showing AXTA's trailing twelve month trading history, with the $30 strike highlighted in orange:
For the various different available expirations for GM options, DDOG options, or AXTA options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $92 strike call option expiring April 16, 2021, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of DDOG. Below is a chart showing GM's trailing twelve month trading history, with the $60 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 16,304 contracts, representing approximately 1.6 million underlying shares or approximately 44.1% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Below is a chart showing DDOG's trailing twelve month trading history, with the $92 strike highlighted in orange: And Axalta Coating Systems Ltd (Symbol: AXTA) options are showing a volume of 11,287 contracts thus far today.
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Below is a chart showing GM's trailing twelve month trading history, with the $60 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 16,304 contracts, representing approximately 1.6 million underlying shares or approximately 44.1% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Especially high volume was seen for the $92 strike call option expiring April 16, 2021, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $92 strike highlighted in orange: And Axalta Coating Systems Ltd (Symbol: AXTA) options are showing a volume of 11,287 contracts thus far today.
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Below is a chart showing GM's trailing twelve month trading history, with the $60 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 16,304 contracts, representing approximately 1.6 million underlying shares or approximately 44.1% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Especially high volume was seen for the $92 strike call option expiring April 16, 2021, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $92 strike highlighted in orange: And Axalta Coating Systems Ltd (Symbol: AXTA) options are showing a volume of 11,287 contracts thus far today.
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Below is a chart showing GM's trailing twelve month trading history, with the $60 strike highlighted in orange: Datadog Inc (Symbol: DDOG) saw options trading volume of 16,304 contracts, representing approximately 1.6 million underlying shares or approximately 44.1% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Below is a chart showing AXTA's trailing twelve month trading history, with the $30 strike highlighted in orange: For the various different available expirations for GM options, DDOG options, or AXTA options, visit StockOptionsChannel.com. Especially high volume was seen for the $92 strike call option expiring April 16, 2021, with 1,666 contracts trading so far today, representing approximately 166,600 underlying shares of DDOG.
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a37c762f-fde1-4f47-929b-2b591a12f610
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718876.0
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2021-04-14 00:00:00 UTC
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3 High-Growth Tech Stocks to Buy and Hold
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DDOG
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https://www.nasdaq.com/articles/3-high-growth-tech-stocks-to-buy-and-hold-2021-04-14
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nan
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nan
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Rising bond yields have sparked a rotation from growth to value stocks over the past two months. As a result, many tech stocks that dazzled growth-oriented investors throughout the pandemic stumbled as the market reassessed their high valuations.
It's prudent to take profits in some stocks that are pricing in too many years of unfettered growth, but it's also foolish to abandon disruptive tech companies that can still profit from long-term secular trends.
Let's examine three tech stocks that saw their prices pulled back over the past two months but could still be worth holding for years: Twilio (NYSE: TWLO), Datadog (NASDAQ: DDOG), and Palantir (NYSE: PLTR).
Image source: Getty Images.
1. Twilio
Twilio's cloud-based platform handles phone calls, text messages, and videos for mobile apps. Developers previously created those features from scratch, which was buggy, time-consuming, and tough to scale.
Twilio's service lets developers outsource those features to its cloud platform with a few lines of code. For example, Lyft routes calls and messages between riders and drivers through Twilio, while Airbnb uses Twilio to connect guests with hosts.
Twilio's revenue rose 55% to $1.76 billion in fiscal 2020. It ended the year with a dollar-based net expansion rate of 137%, which means its existing customers spent 37% more on its services this year than the prior year. It ended the year with over 221,000 active customer accounts, up from about 179,000 a year earlier.
Twilio's adjusted net income rose 62% to $35.9 million as its adjusted EPS rose 44%. Wall Street expects its revenue to rise 38% this year, but for its adjusted earnings to dip into the red again as higher investments and new carrier fees for accessing SMS networks squeeze its margins.
Those near-term challenges are sparking some concerns about Twilio's future, and the stock still looks expensive at 20 times next year's sales. However, Twilio's first-mover's advantage in its niche market, its high net expansion rates, and an expanding mobile market should all propel its stock higher over the next few years.
2. Datadog
Datadog's platform enables IT professionals to monitor the performance of an organization's software and services on unified dashboards. In the past, IT professionals often monitored those applications separately across different hardware and software platforms, which was tedious and prone to mistakes.
More than 400 software platforms, including Amazon Web Services and Microsoft Azure, now offer native support for Datadog's services.
Image source: Getty Images.
Datadog's revenue rose 66% to $603.5 million in fiscal 2020. Its net retention rate, which is roughly comparable to Twilio's net expansion rate, has remained above 130% for 14 straight quarters.
The stickiness of Datadog's dashboards is reflected in its other growth metrics. At the end of 2020, 22% of its customers were using four or more of its services, up from just 10% a year earlier.
Its number of customers generating more than $100,000 in annual recurring revenue (ARR) rose 46% to 1,253 in 2020. Within that total, its number of customers generating over $1 million in ARR grew 94% to 50.
Datadog generated an adjusted net profit of $71.6 million, or $0.22 per share, for the full year, compared to a net loss of $471,000 in 2019. It expects its revenue to rise 37%-39% in fiscal 2021, but for its adjusted earnings to dip 36%-55% as it integrates two recent acquisitions and ramps up its investments again.
Datadog's stock also isn't cheap at 25 times next year's sales, but its silo-busting technology arguably justifies that higher price-to-sales ratio.
3. Palantir
Palantir's platform, which is named after the all-seeing orbs from The Lord of the Rings, accumulates data from disparate sources and helps organizations make data-driven decisions. It generates over half of its revenue from government contracts and plans to become the "default operating system" of the U.S. government for handling data.
Palantir's software is controversial. It was reportedly used to hunt Osama Bin Laden in 2011, but it has also been used by Immigration and Customs Enforcement (ICE) to locate and deport undocumented immigrants. Nonetheless, it continues to win new government contracts as its enterprise-facing Foundry business expands.
Palantir's revenue rose 47% to $1.1 billion in fiscal 2020. Its average revenue per customer increased 41% to $7.9 million, while the average revenue of its top 20 customers jumped 34% to $33.2 million.
Its total number of customers generating more than $5 million in annual revenue rose 54%, while its number of customers generating over $10 million in annual revenue increased 50%.
Palantir's net loss widened from $580 million to $1.17 billion, mainly due to stock-based compensation expenses and the costs of its direct listing last September, but its adjusted gross and operating margins expanded.
Palantir expects its revenue to rise at least 30% in fiscal 2021, but it will likely remain unprofitable. Its stock looks pricey at 23 times next year's sales, but it remains a favorite stock of both Cathie Wood and Robinhood investors, and its long-term growth potential is tough to ignore.
10 stocks we like better than Palantir Technologies Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Palantir Technologies Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Leo Sun owns shares of Amazon and Palantir Technologies Inc.. The Motley Fool owns shares of and recommends Airbnb, Inc., Amazon, Datadog, Microsoft, Palantir Technologies Inc., and Twilio. The Motley Fool recommends the following options: long January 2022 $1920.0 calls on Amazon and short January 2022 $1940.0 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Let's examine three tech stocks that saw their prices pulled back over the past two months but could still be worth holding for years: Twilio (NYSE: TWLO), Datadog (NASDAQ: DDOG), and Palantir (NYSE: PLTR). Wall Street expects its revenue to rise 38% this year, but for its adjusted earnings to dip into the red again as higher investments and new carrier fees for accessing SMS networks squeeze its margins. Datadog's stock also isn't cheap at 25 times next year's sales, but its silo-busting technology arguably justifies that higher price-to-sales ratio.
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Let's examine three tech stocks that saw their prices pulled back over the past two months but could still be worth holding for years: Twilio (NYSE: TWLO), Datadog (NASDAQ: DDOG), and Palantir (NYSE: PLTR). Datadog generated an adjusted net profit of $71.6 million, or $0.22 per share, for the full year, compared to a net loss of $471,000 in 2019. Its total number of customers generating more than $5 million in annual revenue rose 54%, while its number of customers generating over $10 million in annual revenue increased 50%.
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Let's examine three tech stocks that saw their prices pulled back over the past two months but could still be worth holding for years: Twilio (NYSE: TWLO), Datadog (NASDAQ: DDOG), and Palantir (NYSE: PLTR). However, Twilio's first-mover's advantage in its niche market, its high net expansion rates, and an expanding mobile market should all propel its stock higher over the next few years. Its total number of customers generating more than $5 million in annual revenue rose 54%, while its number of customers generating over $10 million in annual revenue increased 50%.
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Let's examine three tech stocks that saw their prices pulled back over the past two months but could still be worth holding for years: Twilio (NYSE: TWLO), Datadog (NASDAQ: DDOG), and Palantir (NYSE: PLTR). 10 stocks we like better than Palantir Technologies Inc. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Palantir Technologies Inc. wasn't one of them!
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bafdc04c-3026-49aa-b5e6-94a5f68a4939
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718877.0
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2021-04-13 00:00:00 UTC
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Datadog Completes Sqreen Acquisition; Street Sees 29.2% Upside
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DDOG
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https://www.nasdaq.com/articles/datadog-completes-sqreen-acquisition-street-sees-29.2-upside-2021-04-13
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nan
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nan
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Monitoring and analytics platform provider Datadog has closed the acquisition of Sqreen. The latter is an SaaS-based security platform that helps clients detect, block, and respond to application-level attacks.
This acquisition enhances Datadog’s (DDOG) current APM functionality and brings it closer to offering customers a robust and full-stack monitoring solution.
Olivier Pomel, CEO of Datadog, said, “The application layer is currently one of the most vulnerable and exploitable attack surfaces. In combining Sqreen with Datadog, we are closing the gap between application developers and security teams and providing our customers with robust application security, without the disjointed visibility, high implementation costs, or steep learning curve of traditional application security products.”
While traditional solutions such as intrusion detection systems and firewalls fall short of catching code-level security risks and vulnerabilities, Sqreen offers Runtime Application Self-Protection (RASP) and In-App Web Application Firewall (WAF). These solutions protect modern distributed applications from attacks that target the application logic. (See Datadog stock analysis on TipRanks)
Sqreen detects and traces attacks from network requests right to the line of code, with this approach blocking suspicious activity and pinpointing the root cause in a faster way.
Furthermore, on March 31, Datadog announced that it became the first company to launch Windows server monitoring of live traffic. This functionality allows companies to monitor their entire network across different operating systems, providing them with complete visibility.
Recently, Needham analyst Jack Andrews reiterated a Buy rating on the stock and increased the price target to $141 (55.9% upside potential) from $109.
Andrews commented, “DDOG delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital efficient business model.”
Turning to the rest of the Street, the consensus rating is a Moderate Buy, based on 7 Buys and 7 Holds. The average analyst price target of $116.92 implies an upside potential of 29.2%. Shares have gained about 144.8% over the past year.
Related News:
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Provention Bio Shares Crash 40% Due To Regulatory Setback For Diabetes Drug
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This acquisition enhances Datadog’s (DDOG) current APM functionality and brings it closer to offering customers a robust and full-stack monitoring solution. Andrews commented, “DDOG delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital efficient business model.” Turning to the rest of the Street, the consensus rating is a Moderate Buy, based on 7 Buys and 7 Holds. (See Datadog stock analysis on TipRanks) Sqreen detects and traces attacks from network requests right to the line of code, with this approach blocking suspicious activity and pinpointing the root cause in a faster way.
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This acquisition enhances Datadog’s (DDOG) current APM functionality and brings it closer to offering customers a robust and full-stack monitoring solution. Andrews commented, “DDOG delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital efficient business model.” Turning to the rest of the Street, the consensus rating is a Moderate Buy, based on 7 Buys and 7 Holds. Monitoring and analytics platform provider Datadog has closed the acquisition of Sqreen.
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Andrews commented, “DDOG delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital efficient business model.” Turning to the rest of the Street, the consensus rating is a Moderate Buy, based on 7 Buys and 7 Holds. This acquisition enhances Datadog’s (DDOG) current APM functionality and brings it closer to offering customers a robust and full-stack monitoring solution. In combining Sqreen with Datadog, we are closing the gap between application developers and security teams and providing our customers with robust application security, without the disjointed visibility, high implementation costs, or steep learning curve of traditional application security products.” While traditional solutions such as intrusion detection systems and firewalls fall short of catching code-level security risks and vulnerabilities, Sqreen offers Runtime Application Self-Protection (RASP) and In-App Web Application Firewall (WAF).
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This acquisition enhances Datadog’s (DDOG) current APM functionality and brings it closer to offering customers a robust and full-stack monitoring solution. Andrews commented, “DDOG delivers a strong combination of product/market fit that should enable the company to execute against a large opportunity with a capital efficient business model.” Turning to the rest of the Street, the consensus rating is a Moderate Buy, based on 7 Buys and 7 Holds. Monitoring and analytics platform provider Datadog has closed the acquisition of Sqreen.
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c2a8c9b9-84f0-4da0-99ad-486a5d439980
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718878.0
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2021-04-09 00:00:00 UTC
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5 Growth Stocks With 43% to 70% Upside, According to Wall Street
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DDOG
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https://www.nasdaq.com/articles/5-growth-stocks-with-43-to-70-upside-according-to-wall-street-2021-04-09
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nan
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nan
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Since the end of the Great Recession, growth stocks have been the best place to put your money to work in the market. Historically low lending rates, coupled with predominantly dovish monetary policy from the Federal Reserve, have created a perfect scenario for fast-paced companies to hire, innovate, and acquire other businesses.
But over the past two months, rising Treasury yields have incited brief, yet steep, sell-offs in growth stocks. What's been an unsettling move lower to some folks represents an opportunity to buy rapidly growing stocks at a substantial discount for long-term investors.
Based on Wall Street's one-year consensus price targets as of April 5, the following five growth stocks all offer upside ranging between 43% and 70%.
Image source: Getty Images.
Teladoc Health: Implied upside of 43%
Let's begin with telehealth provider Teladoc Health (NYSE: TDOC). Teladoc has lost close to 40% of its value in less than two months, primarily as a result of the U.S. successfully administering over 167 million coronavirus vaccines as of April 5. With nearly a quarter of the adult population fully vaccinated, and Amazon announcing a nationwide expansion of its virtual-care platform, there's been some concern about where Teladoc goes from here.
As for Wall Street, the answer is pretty clear: It goes up. With a consensus price target of almost $260, Teladoc offers implied upside of 43% over the next year.
Teladoc is the leading provider of telehealth services in the U.S. and handled nearly 10.6 million virtual visits last year. The beauty of telemedicine is that it's a win up and down the healthcare-treatment chain. It's more convenient for patients, can allow physicians to better keep tabs on at-risk patients, and billed more cheaply than office visits, which health insurers love.
Also, don't forget that Teladoc acquired leading applied health-signals company Livongo Health in November. Livongo's solutions are aided by artificial intelligence and are designed to send tips and nudges to patients with chronic illnesses to help them lead healthier lives. Livongo already has well over 500,000 enrolled diabetes members, and its platform provides a perfect jumping-off point for Teladoc to cross-sell its own solutions.
Image source: Getty Images.
Datadog: Implied upside of 47%
Opportunistic investors might be able to make bank with cloud-based application-monitoring company Datadog (NASDAQ: DDOG), as well. Though shares of Datadog have fallen by more than 30% from their all-time high, Wall Street believes the company has up to 47% upside, based on its one-year consensus price target.
The good news for Datadog is that the end of the pandemic shouldn't mean an end to its rapid sales growth. With more businesses than ever shifting online and into the cloud, we're unlikely to see this trend reverse once workplaces reopen. The ability to understand customer behaviors, monitor key applications in real time, and understand important financial data is more critical now than ever before -- and the company's operating results prove it.
Although Datadog's total customer count with at least $100,000 in annual recurring revenue (ARR) grew by 46% in 2020 to 1,253, the figure that really stands out is the 94% growth in customers generating at least $1 million in ARR. Datadog is scaling seamlessly with its clients and has been able to make bolt-on acquisitions to broaden its product portfolio and appeal to a larger slate of businesses.
With an annual sales-growth rate ranging between 30% and 40%, Datadog appears to have all the tools needed to make patient investors a lot richer.
Image source: Getty Images.
Trulieve Cannabis: Implied upside of 48%
Considering how hot U.S. marijuana stocks have been this year, you might be shocked to learn that, based on Wall Street's 12-month price target, U.S. multistate operator (MSO) Trulieve Cannabis (OTC: TCNNF) offers as much as 48% upside.
What's really interesting about Trulieve's approach, compared to other MSOs, is that it's chosen to focus most of its attention on one market. As of mid-March, before announcing two acquisitions, Trulieve had 83 open dispensaries, 78 of which were located in medical marijuana-legal Florida. Even if Florida fails to legalize recreational weed, it's on pace to be the third-largest marijuana market by 2024.
Why focus on one state? The simple answer is that Trulieve has been able to use saturation in a key market to its advantage. It's been able to effectively build up its brands while keeping marketing costs down, thereby allowing a lot of its revenue to flow to its bottom line.
This is why it's been profitable for 12 consecutive quarters (three full years). In 2020, Trulieve controlled 49% of Florida's market for cannabinoid oils and 53% of the state's share of dried flower.
If Trulieve can successfully duplicate its blueprint in other states, it shouldn't have any issue clearing $1 billion in total sales by 2022. For context, that'd be up from $521.5 million in sales in 2020.
Image source: Getty Images.
Skillz: Implied upside of 63%
Mobile-gaming platform Skillz (NYSE: SKLZ) is another extremely fast-growing company with significant upside potential. The stock plunged roughly 60% from its recent record high, and Wall Street is now looking for the company to gain an estimated 63% over the coming 12 months.
What's noteworthy about Skillz is its operating model. The company is providing a compelling platform for gamers to compete against each other for cash and prizes, with the company and game developers splitting a percentage of the prize value. Because there aren't a lot of costs that go into the platform once it's developed, gross margin for Skillz came in at a whopping 95% in 2020 and 2019.
The big potential for Skillz looks to be the multiyear agreement it reached with the National Football League (NFL) in early February. Developers will be competing to launch NFL-themed games on the platform by later this year or perhaps in 2022. As a reminder, football is the most-popular sport in the United States.
With Wall Street expecting sales to catapult from $230 million in 2020 to nearly $1 billion by 2024, it's no wonder analysts see substantial upside in Skillz.
Image source: Getty Images.
Novavax: Implied upside of 70%
However, the hypergrowth company that may offer some of the biggest upside over the next year is biotech stock Novavax (NASDAQ: NVAX). According to Wall Street, which has a $300 consensus price target on the stock, it could gain 70% over the coming year.
The primary buy thesis for Novavax revolves around its coronavirus disease 2019 (COVID-19) vaccine candidate, NVX-CoV2373. Though its experimental name leaves a lot to be desired, Novavax's COVID-19 candidate proved successful in late-stage trials in the United Kingdom.
The company's vaccine demonstrated 96.4% efficacy against the original strain of the virus, while still providing for 86.3% efficacy against the U.K. variant. On a combined basis, it was shown to have an overall vaccine efficacy of 89.7%.
Even though Novavax's COVID-19 treatment wasn't as effective in a phase 2b South African trial, the investment community is nevertheless hyped about its prospects to help developed and emerging countries in their vaccination processes. Delays on the U.S. front have kept Novavax from making an impact in the highly lucrative U.S. market, but with billions of people worldwide to still vaccinate, Novavax could become one of a half-dozen to dozen key players in that process.
Novavax lost over $7 per share in 2020, but Wall Street believes it can generate between $32 and $39 in earnings per share between 2022 and 2024. That would make buying at its current $177 share price an absolute steal.
10 stocks we like better than Novavax
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Sean Williams owns shares of Amazon and Teladoc Health. The Motley Fool owns shares of and recommends Amazon, Datadog, Skillz Inc., and Teladoc Health. The Motley Fool recommends the following options: long January 2022 $1920.0 calls on Amazon and short January 2022 $1940.0 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog: Implied upside of 47% Opportunistic investors might be able to make bank with cloud-based application-monitoring company Datadog (NASDAQ: DDOG), as well. Historically low lending rates, coupled with predominantly dovish monetary policy from the Federal Reserve, have created a perfect scenario for fast-paced companies to hire, innovate, and acquire other businesses. Livongo's solutions are aided by artificial intelligence and are designed to send tips and nudges to patients with chronic illnesses to help them lead healthier lives.
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Datadog: Implied upside of 47% Opportunistic investors might be able to make bank with cloud-based application-monitoring company Datadog (NASDAQ: DDOG), as well. Based on Wall Street's one-year consensus price targets as of April 5, the following five growth stocks all offer upside ranging between 43% and 70%. Though shares of Datadog have fallen by more than 30% from their all-time high, Wall Street believes the company has up to 47% upside, based on its one-year consensus price target.
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Datadog: Implied upside of 47% Opportunistic investors might be able to make bank with cloud-based application-monitoring company Datadog (NASDAQ: DDOG), as well. Though shares of Datadog have fallen by more than 30% from their all-time high, Wall Street believes the company has up to 47% upside, based on its one-year consensus price target. Trulieve Cannabis: Implied upside of 48% Considering how hot U.S. marijuana stocks have been this year, you might be shocked to learn that, based on Wall Street's 12-month price target, U.S. multistate operator (MSO) Trulieve Cannabis (OTC: TCNNF) offers as much as 48% upside.
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Datadog: Implied upside of 47% Opportunistic investors might be able to make bank with cloud-based application-monitoring company Datadog (NASDAQ: DDOG), as well. In 2020, Trulieve controlled 49% of Florida's market for cannabinoid oils and 53% of the state's share of dried flower. Because there aren't a lot of costs that go into the platform once it's developed, gross margin for Skillz came in at a whopping 95% in 2020 and 2019.
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077d2ff2-cc46-4b56-b321-3f65cbff4078
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718879.0
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2021-04-08 00:00:00 UTC
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Okta's Optimistic Outlook Sends SaaS Stocks Skyward; Constellation Loses Its Buzz
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DDOG
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https://www.nasdaq.com/articles/oktas-optimistic-outlook-sends-saas-stocks-skyward-constellation-loses-its-buzz-2021-04-08
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nan
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nan
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Wall Street got off to a relatively positive start on Thursday morning, although not all of the major market benchmarks were able to post gains. At first glance, U.S. employment data that showed continuing high levels of jobless claims might have seemed like bad news, but investors seemed to take it as a reason to believe that the Federal Reserve will remain accommodative in its monetary policy further into the future. As of just before 11:30 a.m. EDT, the Dow Jones Industrial Average (DJINDICES: ^DJI) was down 27 points to 33,420. However, the S&P 500 (SNPINDEX: ^GSPC) had gained 9 points to a record 4,089, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) had gotten a 102-point lift to 13,791.
The stock market is often viewed as a single entity, but it's valuable to look at the individual companies that make up the market to see what's driving each of them. Okta (NASDAQ: OKTA) posted big gains on Thursday, lifting the entire software-as-a-service stock group with it on favorable comments about its future. However, Constellation Brands (NYSE: STZ) wasn't as fortunate, as its earnings left shareholders wishing for something a little bit stronger.
Okta's on fire
Shares of Okta were up more than 8% on Thursday morning. The provider of subscription-based identity verification services gained, as investors liked what they heard at the company's annual investor day presentation late Wednesday.
Perhaps the best news overall was that Okta sees a healthy pace of growth continuing well into the future. Okta predicted that it would be able to maintain revenue growth of 30% for at least the next three years. That would bring revenue to as much as $2 billion by the end of its 2024 fiscal year.
New products will provide part of the pathway to higher sales. Okta will offer an identity governance administration package to make sure clients remove access when employees leave their jobs or switch to a different role within a company. Meanwhile, Okta's privileged access management platform will help users set different levels of access, offering maximum protection to particularly sensitive data or IT assets. In addition, Okta discussed its acquisition of Auth0, rebutting critics by saying that it didn't pay too much to join forces.
Wall Street analysts seemed generally upbeat about the presentation, and that was enough to restore faith not only in Okta but in some of its fellow beaten-down SaaS stock peers. Cloudflare (NYSE: NET) rose nearly 5%, while CrowdStrike Holdings (NASDAQ: CRWD) and Datadog (NASDAQ: DDOG) were each up 4%. Further good fundamental news could lift Okta and others even higher.
Image source: Getty Images.
Constellation loses its luster
Elsewhere, Constellation Brands shares lost 4%. The beer and spirits specialist suffered a profit decline in the fourth quarter, and investors didn't seem satisfied with its projections for the coming fiscal year.
Quarterly revenue for Constellation was up 3% from year-ago levels, driven largely by a 16% jump in beer sales. Wine and spirits sales, however, were down 19% year over year, and overall, earnings per share for the period were down 12% on a comparable basis. Although Constellation's stake in marijuana giant Canopy Growth (NASDAQ: CGC) has been responsible for some past earnings shortfalls, that wasn't the case this quarter, as earnings would've fallen 11% even without including Canopy's results.
The pressure could continue into fiscal 2022. Even after adjusting for extraordinary items, Constellation expects earnings in its core beverage business to come in below fiscal 2021 levels. Plunging wine and spirits sales in the 22% to 24% range will come from strategic decisions not to focus as strongly on that part of its business, and it'll be enough to offset net sales growth of 7% to 9% in the beer segment.
All of this is part of Constellation's longer-term strategy to emphasize higher-margin parts of its business. Nevertheless, the stock's move lower today suggests that Constellation shareholders are getting impatient for results.
10 stocks we like better than Okta
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David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Okta wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of February 24, 2021
Dan Caplinger owns shares of Cloudflare, Inc. and Datadog. The Motley Fool owns shares of and recommends Cloudflare, Inc., Constellation Brands, CrowdStrike Holdings, Inc., Datadog, and Okta. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Cloudflare (NYSE: NET) rose nearly 5%, while CrowdStrike Holdings (NASDAQ: CRWD) and Datadog (NASDAQ: DDOG) were each up 4%. At first glance, U.S. employment data that showed continuing high levels of jobless claims might have seemed like bad news, but investors seemed to take it as a reason to believe that the Federal Reserve will remain accommodative in its monetary policy further into the future. Okta will offer an identity governance administration package to make sure clients remove access when employees leave their jobs or switch to a different role within a company.
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Cloudflare (NYSE: NET) rose nearly 5%, while CrowdStrike Holdings (NASDAQ: CRWD) and Datadog (NASDAQ: DDOG) were each up 4%. Okta (NASDAQ: OKTA) posted big gains on Thursday, lifting the entire software-as-a-service stock group with it on favorable comments about its future. The Motley Fool owns shares of and recommends Cloudflare, Inc., Constellation Brands, CrowdStrike Holdings, Inc., Datadog, and Okta.
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Cloudflare (NYSE: NET) rose nearly 5%, while CrowdStrike Holdings (NASDAQ: CRWD) and Datadog (NASDAQ: DDOG) were each up 4%. Okta (NASDAQ: OKTA) posted big gains on Thursday, lifting the entire software-as-a-service stock group with it on favorable comments about its future. 10 stocks we like better than Okta When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen.
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Cloudflare (NYSE: NET) rose nearly 5%, while CrowdStrike Holdings (NASDAQ: CRWD) and Datadog (NASDAQ: DDOG) were each up 4%. The stock market is often viewed as a single entity, but it's valuable to look at the individual companies that make up the market to see what's driving each of them. However, Constellation Brands (NYSE: STZ) wasn't as fortunate, as its earnings left shareholders wishing for something a little bit stronger.
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ba900e40-b3a3-4fdc-8d79-0ce076131498
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718880.0
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2021-04-05 00:00:00 UTC
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Why CrowdStrike, Datadog, and IAC/InterActiveCorp Fell 11.6% or More in March
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DDOG
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https://www.nasdaq.com/articles/why-crowdstrike-datadog-and-iac-interactivecorp-fell-11.6-or-more-in-march-2021-04-05
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nan
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nan
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What happened
Shares of IAC/InterActiveCorp (NASDAQ: IAC), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) fell 11.6%, 12.7%, and 15.5%, respectively, in March, according to data from S&P Global Market Intelligence. None of the aforementioned companies reported any significant bad news; in fact, both CrowdStrike and IAC reported good news. Instead, all appeared to fall because of the same market dynamics of rising long-term interest rates and a rotation to cheaper "reopening" stocks.
Image source: Getty Images.
So what
In 2020, technology-oriented growth stocks skyrocketed. Fears over the pandemic caused long-term interest rates to fall. At the same time, the economy leaned more heavily on new technologies amid the stay-at-home economy. Higher growth and lower interest rates increased the value of future earnings for new-age tech stocks, causing many to skyrocket in value.
After a stellar 2020 run, the aforementioned tech stocks were anything but cheap heading into the month. As vaccine rollouts have accelerated, and with the government having passed the massive American Rescue Plan in March, people now believe the economy will reopen more quickly. Long-term rates have moved up, prompting talk of inflation. This reversal has investors pondering decelerating growth and higher discount rates on future earnings of tech stocks. So it's no surprise that these three stocks fell, as investors rotated more toward cheaper "reopening" and cyclical plays.
The sell-off came in spite of general good news among all three companies. CrowdStrike reported its Q4 earnings during the month, posting red-hot 74.2% revenue growth and expanding profit margin, handily beating analyst expectations to cap off an incredible year. CrowdStrike's novel artificial intelligence- and cloud-based cybersecurity platform is clearly catching on with businesses large and small. Notably, SolarWinds (NYSE: SWI) adopted CrowdStrike's solutions following its massive SUNBURST hack.
Meanwhile, IAC didn't have much overall company news, but the holding company did hold an analyst day for its Vimeo business, which the company plans to spin off in the near future. 2020 was a blockbuster year for Vimeo, as businesses large and small turned to its high-quality video solutions to reach customers and employees alike. Subscriber numbers grew 24% in 2020, and revenue accelerated 44%, all while the company inched closer to profitability. Still, management claims Vimeo is just scratching the surface of a $70 billion market opportunity, compared with just $283 million in 2020 revenue.
Meanwhile, March was a quiet month for Datadog, a cloud-based enterprise infrastructure and network monitoring software company that also saw results skyrocket during the pandemic. However, in February, Datadog gave somewhat conservative guidance for 2021, forecasting just 37.5% growth, down from 66% growth in 2020, and even lower adjusted (non-GAAP) operating earnings than it posted last year.
Now what
Though each of these companies had a rough month, investors should keep in mind that none are bad companies. CrowdStrike and Datadog are becoming hugely popular services to monitor and protect more distributed corporate workforces in the cloud -- a trend that will linger on beyond the pandemic. And IAC should continue its impressive track record of nurturing and then spinning off winning internet businesses.
Of course, even after their sell-offs, no one would describe these stocks as cheap, and 2021 could continue to be a tough year for these types of stocks. Yet for long-term-oriented investors, you could do far worse than holding on to these high-quality tech stocks beyond the economy's reopening, with an eye on the next decade, not just the next few months.
10 stocks we like better than CrowdStrike Holdings
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and CrowdStrike Holdings wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of February 24, 2021
Billy Duberstein owns shares of CrowdStrike Holdings. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends CrowdStrike Holdings. and Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of IAC/InterActiveCorp (NASDAQ: IAC), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) fell 11.6%, 12.7%, and 15.5%, respectively, in March, according to data from S&P Global Market Intelligence. CrowdStrike reported its Q4 earnings during the month, posting red-hot 74.2% revenue growth and expanding profit margin, handily beating analyst expectations to cap off an incredible year. Meanwhile, March was a quiet month for Datadog, a cloud-based enterprise infrastructure and network monitoring software company that also saw results skyrocket during the pandemic.
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What happened Shares of IAC/InterActiveCorp (NASDAQ: IAC), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) fell 11.6%, 12.7%, and 15.5%, respectively, in March, according to data from S&P Global Market Intelligence. None of the aforementioned companies reported any significant bad news; in fact, both CrowdStrike and IAC reported good news. Fears over the pandemic caused long-term interest rates to fall.
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What happened Shares of IAC/InterActiveCorp (NASDAQ: IAC), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) fell 11.6%, 12.7%, and 15.5%, respectively, in March, according to data from S&P Global Market Intelligence. Meanwhile, IAC didn't have much overall company news, but the holding company did hold an analyst day for its Vimeo business, which the company plans to spin off in the near future. 10 stocks we like better than CrowdStrike Holdings When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen.
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What happened Shares of IAC/InterActiveCorp (NASDAQ: IAC), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) fell 11.6%, 12.7%, and 15.5%, respectively, in March, according to data from S&P Global Market Intelligence. Meanwhile, IAC didn't have much overall company news, but the holding company did hold an analyst day for its Vimeo business, which the company plans to spin off in the near future. Yet for long-term-oriented investors, you could do far worse than holding on to these high-quality tech stocks beyond the economy's reopening, with an eye on the next decade, not just the next few months.
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4014b3b3-1d53-44fd-83bb-a5888328be2c
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718881.0
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2021-04-01 00:00:00 UTC
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Why Datadog Stock Jumped on Thursday
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DDOG
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https://www.nasdaq.com/articles/why-datadog-stock-jumped-on-thursday-2021-04-01
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nan
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nan
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What happened
Shares of Datadog (NASDAQ: DDOG) jumped on Thursday. The monitoring and analytics platform provider's shares rose as much as 5.8%. As of 1:15 p.m. EDT, however, the stock was up 3.8%.
The stock's gain was likely due to a combination of an upbeat day in the market for growth stocks in general as well as an analyst's move to upgrade his rating for the stock.
Image source: Getty Images.
So what
As the Nasdaq Composite gained 1.5% as of this writing on Thursday, many growth stocks like Datadog rose even more. This broader-market optimism for growth stocks, therefore, likely helped provide a lift to Datadog's stock today.
Also helping the stock was Monness Crespi analyst Brian White's move to upgrade his rating on Datadog stock from "neutral" to "buy." White's $100 12-month price target translates to more than 15% upside.
Now what
Datadog's business has been growing very rapidly. Fourth-quarter revenue was up 56% year over year.
Importantly, management expects more strong growth this year. The company guided for 2021 revenue between $825 million and $835 million, up from 2020 revenue of about $604 million.
"In 2020, we enhanced our positioning as the most complete and cloud-native end-to-end observability platform," explained Datadog Co-founder and CEO Olivier Pomel in the company's Q4 earnings release in February. "But we are even more excited for what's to come, and plan for meaningful continued investments to enhance our long-term positioning."
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Thursday. So what As the Nasdaq Composite gained 1.5% as of this writing on Thursday, many growth stocks like Datadog rose even more. "In 2020, we enhanced our positioning as the most complete and cloud-native end-to-end observability platform," explained Datadog Co-founder and CEO Olivier Pomel in the company's Q4 earnings release in February.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Thursday. The monitoring and analytics platform provider's shares rose as much as 5.8%. So what As the Nasdaq Composite gained 1.5% as of this writing on Thursday, many growth stocks like Datadog rose even more.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Thursday. The stock's gain was likely due to a combination of an upbeat day in the market for growth stocks in general as well as an analyst's move to upgrade his rating for the stock. Also helping the stock was Monness Crespi analyst Brian White's move to upgrade his rating on Datadog stock from "neutral" to "buy."
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Thursday. Also helping the stock was Monness Crespi analyst Brian White's move to upgrade his rating on Datadog stock from "neutral" to "buy." Fourth-quarter revenue was up 56% year over year.
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2cc4445c-e4f2-4410-8296-1b21e3b5652d
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718882.0
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2021-03-31 00:00:00 UTC
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Wednesday's ETF Movers: WCLD, XTN
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DDOG
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https://www.nasdaq.com/articles/wednesdays-etf-movers%3A-wcld-xtn-2021-03-31
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nan
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nan
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In trading on Wednesday, the WisdomTree Cloud Computing Fund ETF is outperforming other ETFs, up about 3.7% on the day. Components of that ETF showing particular strength include shares of Square, up about 7.8% and shares of Datadog, up about 7.4% on the day.
And underperforming other ETFs today is the SPDR— S&P— Transportation ETF, off about 1.1% in Wednesday afternoon trading. Among components of that ETF with the weakest showing on Wednesday were shares of Avis Budget Group, lower by about 3%, and shares of Echo Global Logistics, lower by about 2.8% on the day.
VIDEO: Wednesday's ETF Movers: WCLD, XTN
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Components of that ETF showing particular strength include shares of Square, up about 7.8% and shares of Datadog, up about 7.4% on the day. Among components of that ETF with the weakest showing on Wednesday were shares of Avis Budget Group, lower by about 3%, and shares of Echo Global Logistics, lower by about 2.8% on the day. VIDEO: Wednesday's ETF Movers: WCLD, XTN The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Components of that ETF showing particular strength include shares of Square, up about 7.8% and shares of Datadog, up about 7.4% on the day. Among components of that ETF with the weakest showing on Wednesday were shares of Avis Budget Group, lower by about 3%, and shares of Echo Global Logistics, lower by about 2.8% on the day. VIDEO: Wednesday's ETF Movers: WCLD, XTN The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Wednesday, the WisdomTree Cloud Computing Fund ETF is outperforming other ETFs, up about 3.7% on the day. And underperforming other ETFs today is the SPDR— S&P— Transportation ETF, off about 1.1% in Wednesday afternoon trading. Among components of that ETF with the weakest showing on Wednesday were shares of Avis Budget Group, lower by about 3%, and shares of Echo Global Logistics, lower by about 2.8% on the day.
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In trading on Wednesday, the WisdomTree Cloud Computing Fund ETF is outperforming other ETFs, up about 3.7% on the day. Components of that ETF showing particular strength include shares of Square, up about 7.8% and shares of Datadog, up about 7.4% on the day. And underperforming other ETFs today is the SPDR— S&P— Transportation ETF, off about 1.1% in Wednesday afternoon trading.
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905859cc-b64e-4c6e-b9b2-0a55a0950188
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718883.0
|
2021-03-31 00:00:00 UTC
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Have $5,000? Buying These 3 Stocks Could Be the Smartest Move You Ever Made
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DDOG
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https://www.nasdaq.com/articles/have-%245000-buying-these-3-stocks-could-be-the-smartest-move-you-ever-made-2021-03-31
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nan
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nan
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Lately, the stock market has been on a wild ride, triggered by the rising yield curve and rotation of investors from growth stocks to value stocks. Correctly timing the market amid such high uncertainty is near impossible. But such times of uncertainty also present an opportunity -- to pick up fundamentally strong stocks at deep discounts.
To leverage this opportunity, investors should opt for stocks riding structural trends, which in turn translates into high chances of solid long-term returns. In case you are in search of such picks and have an extra $5,000 which is not needed to pay bills or for other contingencies, then Square (NYSE: SQ), Datadog (NASDAQ: DDOG), and Fulgent Genetics (NASDAQ: FLGT) may prove to be just the right picks for you.
Image source: Getty Images.
1. Square
Fintech player Square has emerged as a force to reckon with in the financial services space. The company provides point-of-sale devices and solutions, capital, analytics, and other business services to merchants in exchange for a fee. The company also caters to customers through its peer-to-peer payment platform, Cash App.
The seller ecosystem is a bigger business segment for Square. Despite the pandemic negatively affecting brick-and-mortar retailers, the company processed seller gross payment volume (GPV) of $103.7 billion in fiscal 2020, down year over year by 13.6%. However, the company expects pandemic headwinds to start easing by late March 2021.
Square is no longer dependent only on small businesses -- this is making the seller business more resistant to economic uncertainties. In the fourth quarter, larger sellers with GPV over $0.5 million accounted for almost 60% of the company's total seller GPV.
Cash App is a smaller but much faster-growing part of Square's business. The peer-to-peer platform's monthly active users jumped year over year by 50% to 36 million in December 2020. Individuals use Cash App for performing various financial tasks such as directly depositing and transferring money in their bank accounts, for investing in stocks and Bitcoin (CRYPTO: BTC), and for using the Square Cash Card (debit card linked with Cash App account). Square's revenues from the Bitcoin exchange jumped by a phenomenal 785% year over year to $4.6 billion in fiscal 2020.
Square is trading at just over 110 times forward earnings. These valuations are quite steep. However, Square estimates its total addressable market to be over $160 billion. The company has pegged its market penetration to be less than 3%. Considering the company's fiscal 2020 revenues of $9.5 billion, the market share comes to only 6%. The company also posted GAAP profit of $213 million in fiscal 2020. With a huge market opportunity, this profitable fintech has much potential to grow in the next few years.
2. Datadog
Cloud-native observability company Datadog offers software solutions to monitor IT infrastructure, networks, applications, user experiences, log management, incident management, and security of an organization -- on a unified dashboard and in real-time. The company has been a major beneficiary of the pandemic-driven corporate digital transformation and cloud migration -- a secular trend that will continue to be a tailwind in the long run. While this hot stock has cooled off after the February tech sell-off and weaker-than-anticipated fiscal 2021 earnings guidance, the company's offerings are still much in demand.
In 2020, the number of Datadog customers paying more than $1 million in annual recurring revenues (ARR) grew year over year by 94% to 97, while those paying ARR of over $100,000 were up by 46% to 1,253. Datadog's dollar-based net retention rate (a metric to gauge the new revenue coming by cross-selling to existing customers) has been 130% for fourteen consecutive quarters, which also includes the fourth quarter. At the end of the fourth quarter, 72% of the customers were using two or more of the company's products, while 22% were using four or more products. The company's "landing and expanding" model seems to have now created a sticky customer base.
Last year, Datadog's revenues soared 66% to $603.5 million, non-GAAP net income came at $71.6 million, and free cash flow was $83 million. For fiscal 2021, the company has guided revenues to grow year over year by 37% to 38% and non-GAAP net income per share to fall year over year by 36% to 54%. However, the fall in earnings is not that big a challenge, considering that Datadog is prioritizing revenue growth over near-term profitability.
Trading at nearly 310 times forward earnings, the stock is pricey. However, considering that the company pegs its addressable market to around $35 billion and is already a dominant player in the observability space, there is significant potential for the stock to go even higher in the coming years.
3. Fulgent Genetics
I have recommended Fulgent Genetics as a great growth stock several times before and I am doing it again -- this genetic technology company which has now turned into a leading COVID-19 testing player has solid potential to grow even after the pandemic.
Fulgent Genetics had a dream run in 2020. Revenues rose by 1,200% to $421.7 million, while GAAP net income improved dramatically year over year from a loss of $411,000 to a profit of $214.3 million. The company processed 4.4 million tests in 2020 -- a stark jump from 60,000 tests in 2019. Fulgent Genetics ended fiscal 2020 with $432 million liquidity and $15.8 million debt on its balance sheet.
Despite the phenomenal results, investors are concerned about COVID-19 testing revenues drying up in the next few years, which in turn will have a dramatic effect on the company's growth trajectory. This concern is reasonable considering that most of the growth in fiscal 2020 came from the COVID-19 testing business.
However, the future of Fulgent's non-COVID testing business -- where Fulgent Genetics is using next-generation sequencing (NGS) technology to diagnose 5,700 genetic conditions based on mutations in over 18,000 genes at an affordable price-- is now secure.
There is now increased brand awareness about the company among customers as well as payers. Once extensively dependent on cash-paying customers, the company has now become an in-network laboratory for several regional payers and has forged relationships with national payers. The company's Picture Genetics platform is making it even more convenient to conduct genetic tests -- both for COVID-19 and non-COVID conditions -- in the comfort of home.
Fulgent's share prices have already increased over 619% in the last year and over 82% so far this year. The company is now guiding for a 90% year-over-year increase in fiscal 2021 revenues to $800 million, which is a very encouraging forecast on the back of an already strong year. Against this backdrop, the company could continue to soar in 2021.
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The Motley Fool owns shares of and recommends Bitcoin, Datadog, Fulgent Genetics, Inc., and Square. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In case you are in search of such picks and have an extra $5,000 which is not needed to pay bills or for other contingencies, then Square (NYSE: SQ), Datadog (NASDAQ: DDOG), and Fulgent Genetics (NASDAQ: FLGT) may prove to be just the right picks for you. To leverage this opportunity, investors should opt for stocks riding structural trends, which in turn translates into high chances of solid long-term returns. The company has been a major beneficiary of the pandemic-driven corporate digital transformation and cloud migration -- a secular trend that will continue to be a tailwind in the long run.
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In case you are in search of such picks and have an extra $5,000 which is not needed to pay bills or for other contingencies, then Square (NYSE: SQ), Datadog (NASDAQ: DDOG), and Fulgent Genetics (NASDAQ: FLGT) may prove to be just the right picks for you. Last year, Datadog's revenues soared 66% to $603.5 million, non-GAAP net income came at $71.6 million, and free cash flow was $83 million. For fiscal 2021, the company has guided revenues to grow year over year by 37% to 38% and non-GAAP net income per share to fall year over year by 36% to 54%.
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In case you are in search of such picks and have an extra $5,000 which is not needed to pay bills or for other contingencies, then Square (NYSE: SQ), Datadog (NASDAQ: DDOG), and Fulgent Genetics (NASDAQ: FLGT) may prove to be just the right picks for you. For fiscal 2021, the company has guided revenues to grow year over year by 37% to 38% and non-GAAP net income per share to fall year over year by 36% to 54%. Fulgent Genetics I have recommended Fulgent Genetics as a great growth stock several times before and I am doing it again -- this genetic technology company which has now turned into a leading COVID-19 testing player has solid potential to grow even after the pandemic.
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In case you are in search of such picks and have an extra $5,000 which is not needed to pay bills or for other contingencies, then Square (NYSE: SQ), Datadog (NASDAQ: DDOG), and Fulgent Genetics (NASDAQ: FLGT) may prove to be just the right picks for you. Square's revenues from the Bitcoin exchange jumped by a phenomenal 785% year over year to $4.6 billion in fiscal 2020. Fulgent Genetics I have recommended Fulgent Genetics as a great growth stock several times before and I am doing it again -- this genetic technology company which has now turned into a leading COVID-19 testing player has solid potential to grow even after the pandemic.
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d4a30eb4-4177-48b6-b819-d5e28cba892a
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718884.0
|
2021-03-30 00:00:00 UTC
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Datadog Enters Oversold Territory (DDOG)
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DDOG
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https://www.nasdaq.com/articles/datadog-enters-oversold-territory-ddog-2021-03-30
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nan
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nan
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Legendary investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful. One way we can try to measure the level of fear in a given stock is through a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In trading on Tuesday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 29.9, after changing hands as low as $74.53 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 55.5. A bullish investor could look at DDOG's 29.9 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares:
Looking at the chart above, DDOG's low point in its 52 week range is $33.04 per share, with $119.433 as the 52 week high point — that compares with a last trade of $77.04.
Find out what 9 other oversold stocks you need to know about »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Tuesday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 29.9, after changing hands as low as $74.53 per share. A bullish investor could look at DDOG's 29.9 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $33.04 per share, with $119.433 as the 52 week high point — that compares with a last trade of $77.04.
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A bullish investor could look at DDOG's 29.9 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $33.04 per share, with $119.433 as the 52 week high point — that compares with a last trade of $77.04. In trading on Tuesday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 29.9, after changing hands as low as $74.53 per share.
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In trading on Tuesday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 29.9, after changing hands as low as $74.53 per share. A bullish investor could look at DDOG's 29.9 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $33.04 per share, with $119.433 as the 52 week high point — that compares with a last trade of $77.04.
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In trading on Tuesday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 29.9, after changing hands as low as $74.53 per share. A bullish investor could look at DDOG's 29.9 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $33.04 per share, with $119.433 as the 52 week high point — that compares with a last trade of $77.04.
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b2a12f0a-9e0f-4317-b4a7-9247a462c235
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718885.0
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2021-03-29 00:00:00 UTC
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Implied WEBL Analyst Target Price: $73
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DDOG
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https://www.nasdaq.com/articles/implied-webl-analyst-target-price%3A-%2473-2021-03-29
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nan
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nan
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Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the Daily Dow Jones Internet Bull 3X Shares ETF (Symbol: WEBL), we found that the implied analyst target price for the ETF based upon its underlying holdings is $72.77 per unit.
With WEBL trading at a recent price near $63.60 per unit, that means that analysts see 14.42% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of WEBL's underlying holdings with notable upside to their analyst target prices are Zillow Group Inc (Symbol: ZG), Datadog Inc (Symbol: DDOG), and Fastly Inc (Symbol: FSLY). Although ZG has traded at a recent price of $132.08/share, the average analyst target is 48.43% higher at $196.05/share. Similarly, DDOG has 46.22% upside from the recent share price of $80.29 if the average analyst target price of $117.40/share is reached, and analysts on average are expecting FSLY to reach a target price of $84.33/share, which is 27.47% above the recent price of $66.16. Below is a twelve month price history chart comparing the stock performance of ZG, DDOG, and FSLY:
Below is a summary table of the current analyst target prices discussed above:
NAME SYMBOL RECENT PRICE AVG. ANALYST 12-MO. TARGET % UPSIDE TO TARGET
Daily Dow Jones Internet Bull 3X Shares ETF WEBL $63.60 $72.77 14.42%
Zillow Group Inc ZG $132.08 $196.05 48.43%
Datadog Inc DDOG $80.29 $117.40 46.22%
Fastly Inc FSLY $66.16 $84.33 27.47%
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.
10 ETFs With Most Upside To Analyst Targets »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Daily Dow Jones Internet Bull 3X Shares ETF WEBL $63.60 $72.77 14.42% Zillow Group Inc ZG $132.08 $196.05 48.43% Datadog Inc DDOG $80.29 $117.40 46.22% Fastly Inc FSLY $66.16 $84.33 27.47% Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Three of WEBL's underlying holdings with notable upside to their analyst target prices are Zillow Group Inc (Symbol: ZG), Datadog Inc (Symbol: DDOG), and Fastly Inc (Symbol: FSLY). Similarly, DDOG has 46.22% upside from the recent share price of $80.29 if the average analyst target price of $117.40/share is reached, and analysts on average are expecting FSLY to reach a target price of $84.33/share, which is 27.47% above the recent price of $66.16.
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Three of WEBL's underlying holdings with notable upside to their analyst target prices are Zillow Group Inc (Symbol: ZG), Datadog Inc (Symbol: DDOG), and Fastly Inc (Symbol: FSLY). Daily Dow Jones Internet Bull 3X Shares ETF WEBL $63.60 $72.77 14.42% Zillow Group Inc ZG $132.08 $196.05 48.43% Datadog Inc DDOG $80.29 $117.40 46.22% Fastly Inc FSLY $66.16 $84.33 27.47% Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Similarly, DDOG has 46.22% upside from the recent share price of $80.29 if the average analyst target price of $117.40/share is reached, and analysts on average are expecting FSLY to reach a target price of $84.33/share, which is 27.47% above the recent price of $66.16.
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Similarly, DDOG has 46.22% upside from the recent share price of $80.29 if the average analyst target price of $117.40/share is reached, and analysts on average are expecting FSLY to reach a target price of $84.33/share, which is 27.47% above the recent price of $66.16. Three of WEBL's underlying holdings with notable upside to their analyst target prices are Zillow Group Inc (Symbol: ZG), Datadog Inc (Symbol: DDOG), and Fastly Inc (Symbol: FSLY). Below is a twelve month price history chart comparing the stock performance of ZG, DDOG, and FSLY: Below is a summary table of the current analyst target prices discussed above:
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Daily Dow Jones Internet Bull 3X Shares ETF WEBL $63.60 $72.77 14.42% Zillow Group Inc ZG $132.08 $196.05 48.43% Datadog Inc DDOG $80.29 $117.40 46.22% Fastly Inc FSLY $66.16 $84.33 27.47% Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Three of WEBL's underlying holdings with notable upside to their analyst target prices are Zillow Group Inc (Symbol: ZG), Datadog Inc (Symbol: DDOG), and Fastly Inc (Symbol: FSLY). Similarly, DDOG has 46.22% upside from the recent share price of $80.29 if the average analyst target price of $117.40/share is reached, and analysts on average are expecting FSLY to reach a target price of $84.33/share, which is 27.47% above the recent price of $66.16.
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306f159d-79d3-42d1-941b-098c0372e5a8
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718886.0
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2021-03-25 00:00:00 UTC
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Notable Thursday Option Activity: LMNX, NSC, DDOG
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DDOG
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https://www.nasdaq.com/articles/notable-thursday-option-activity%3A-lmnx-nsc-ddog-2021-03-25
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nan
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nan
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Luminex Corp (Symbol: LMNX), where a total volume of 4,912 contracts has been traded thus far today, a contract volume which is representative of approximately 491,200 underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 52.8% of LMNX's average daily trading volume over the past month, of 930,125 shares. Particularly high volume was seen for the $35 strike call option expiring May 21, 2021, with 2,005 contracts trading so far today, representing approximately 200,500 underlying shares of LMNX. Below is a chart showing LMNX's trailing twelve month trading history, with the $35 strike highlighted in orange:
Norfolk Southern Corp (Symbol: NSC) saw options trading volume of 7,080 contracts, representing approximately 708,000 underlying shares or approximately 51.2% of NSC's average daily trading volume over the past month, of 1.4 million shares. Especially high volume was seen for the $245 strike put option expiring April 16, 2021, with 2,083 contracts trading so far today, representing approximately 208,300 underlying shares of NSC. Below is a chart showing NSC's trailing twelve month trading history, with the $245 strike highlighted in orange:
And Datadog Inc (Symbol: DDOG) options are showing a volume of 21,035 contracts thus far today. That number of contracts represents approximately 2.1 million underlying shares, working out to a sizeable 51.2% of DDOG's average daily trading volume over the past month, of 4.1 million shares. Especially high volume was seen for the $85 strike put option expiring March 26, 2021, with 8,813 contracts trading so far today, representing approximately 881,300 underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange:
For the various different available expirations for LMNX options, NSC options, or DDOG options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Especially high volume was seen for the $85 strike put option expiring March 26, 2021, with 8,813 contracts trading so far today, representing approximately 881,300 underlying shares of DDOG. Below is a chart showing NSC's trailing twelve month trading history, with the $245 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 21,035 contracts thus far today. That number of contracts represents approximately 2.1 million underlying shares, working out to a sizeable 51.2% of DDOG's average daily trading volume over the past month, of 4.1 million shares.
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Below is a chart showing NSC's trailing twelve month trading history, with the $245 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 21,035 contracts thus far today. That number of contracts represents approximately 2.1 million underlying shares, working out to a sizeable 51.2% of DDOG's average daily trading volume over the past month, of 4.1 million shares. Especially high volume was seen for the $85 strike put option expiring March 26, 2021, with 8,813 contracts trading so far today, representing approximately 881,300 underlying shares of DDOG.
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Especially high volume was seen for the $85 strike put option expiring March 26, 2021, with 8,813 contracts trading so far today, representing approximately 881,300 underlying shares of DDOG. Below is a chart showing NSC's trailing twelve month trading history, with the $245 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 21,035 contracts thus far today. That number of contracts represents approximately 2.1 million underlying shares, working out to a sizeable 51.2% of DDOG's average daily trading volume over the past month, of 4.1 million shares.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange: For the various different available expirations for LMNX options, NSC options, or DDOG options, visit StockOptionsChannel.com. Below is a chart showing NSC's trailing twelve month trading history, with the $245 strike highlighted in orange: And Datadog Inc (Symbol: DDOG) options are showing a volume of 21,035 contracts thus far today. That number of contracts represents approximately 2.1 million underlying shares, working out to a sizeable 51.2% of DDOG's average daily trading volume over the past month, of 4.1 million shares.
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ab3c7d47-d091-4531-b47c-081b316bafa4
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718887.0
|
2021-03-19 00:00:00 UTC
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Interesting DDOG Put And Call Options For May 21st
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DDOG
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https://www.nasdaq.com/articles/interesting-ddog-put-and-call-options-for-may-21st-2021-03-19
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nan
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nan
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Investors in Datadog Inc (Symbol: DDOG) saw new options begin trading this week, for the May 21st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new May 21st contracts and identified one put and one call contract of particular interest.
The put contract at the $80.00 strike price has a current bid of $6.25. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $80.00, but will also collect the premium, putting the cost basis of the shares at $73.75 (before broker commissions). To an investor already interested in purchasing shares of DDOG, that could represent an attractive alternative to paying $84.17/share today.
Because the $80.00 strike represents an approximate 5% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 63%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 7.81% return on the cash commitment, or 45.26% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Datadog Inc, and highlighting in green where the $80.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $85.00 strike price has a current bid of $8.05. If an investor was to purchase shares of DDOG stock at the current price level of $84.17/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $85.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 10.55% if the stock gets called away at the May 21st expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $85.00 strike highlighted in red:
Considering the fact that the $85.00 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 47%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 9.56% boost of extra return to the investor, or 55.41% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example, as well as the call contract example, are both approximately 62%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $84.17) to be 60%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if DDOG shares really soar, which is why looking at the trailing twelve month trading history for Datadog Inc, as well as studying the business fundamentals becomes important. Below is a chart showing DDOG's trailing twelve month trading history, with the $85.00 strike highlighted in red: Considering the fact that the $85.00 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options begin trading this week, for the May 21st expiration.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $85.00 strike highlighted in red: Considering the fact that the $85.00 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options begin trading this week, for the May 21st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new May 21st contracts and identified one put and one call contract of particular interest.
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Below is a chart showing DDOG's trailing twelve month trading history, with the $85.00 strike highlighted in red: Considering the fact that the $85.00 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options begin trading this week, for the May 21st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new May 21st contracts and identified one put and one call contract of particular interest.
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At Stock Options Channel, our YieldBoost formula has looked up and down the DDOG options chain for the new May 21st contracts and identified one put and one call contract of particular interest. Below is a chart showing DDOG's trailing twelve month trading history, with the $85.00 strike highlighted in red: Considering the fact that the $85.00 strike represents an approximate 1% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in Datadog Inc (Symbol: DDOG) saw new options begin trading this week, for the May 21st expiration.
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1c171bbc-f4ce-493b-a1fc-006860409120
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718888.0
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2021-03-18 00:00:00 UTC
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Better Buy: Adobe vs. Datadog
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DDOG
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https://www.nasdaq.com/articles/better-buy%3A-adobe-vs.-datadog-2021-03-18
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nan
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nan
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Adobe Systems (NASDAQ: ADBE) and Datadog (NASDAQ: DDOG) both generated impressive returns for investors over the past 12 months. Adobe's stock advanced nearly 60% as demand for its cloud-based software remained stable throughout the pandemic. Datadog's stock roughly tripled, fueled by robust demand for its unified software monitoring services.
Datadog, which was founded in 2010 and went public in 2019, was clearly a more exciting investment for growth-oriented investors. But Adobe, which successfully transformed its portfolio of desktop-based software into cloud-based services over the past eight years, also posted solid growth for a 28-year-old tech giant.
As rising bond yields spark a rotation from growth stocks to value stocks, will Datadog remain the better investment this year? Let's dig deeper into these two very different software companies to decide.
Image source: Getty Images.
The differences between Adobe and Datadog
Adobe generated 72% of its revenue from its Digital Media segment, which houses its Creative and Document clouds, in fiscal 2020. These clouds offer its flagship software products -- including Photoshop, Premiere Pro, Illustrator, and After Effects -- as subscription-based cloud services.
The rest of Adobe's revenue mainly came from its Digital Experience segment, which provides cloud-based advertising, e-commerce, and analytics services to enterprise customers.
Datadog helps IT professionals monitor the performance of different servers, databases, cloud services, and mobile apps on its unified dashboards. This approach breaks down data silos across large companies and helps IT professionals diagnose issues and spot potential problems before they occur.
Adobe generates stable growth at a reasonable price
Adobe's revenue increased 15% to $12.9 billion in 2020, as its Digital Media and Digital Experience revenue rose 20% and 12%, respectively. Demand for its Creative and Document Cloud services remained broadly stable throughout the year, even as some of its end markets -- including the entertainment industry -- experienced disruptions during the pandemic.
Image source: Getty Images.
Its Digital Experience segment felt more of an impact from the downturn, as the sluggish growth of its advertising cloud during the crisis offset the strength of its other enterprise-facing services. It also discontinued the advertising cloud's actively managed services for programmatic TV ads, which generated lower-margin revenue than its automated self-serve ads.
But Adobe's adjusted operating margin still expanded during the year, it repurchased $3 billion in shares, and its adjusted earnings improved 28%. It expects its revenue and adjusted earnings to grow 18% and 11%, respectively, in 2021. Its stock doesn't look particularly cheap at 34 times forward earnings and 14 times this year's sales, but its evergreen stability arguably justifies that slight premium.
Datadog generates stronger growth at a frothier price
Datadog's revenue surged 66% to $603.5 million in fiscal 2020. It ended the year with 1,253 customers generating more than $100,000 in annual recurring revenue (ARR), up 46% from the end of 2019. Its total number of customers generating more than $1 million in ARR increased 94% to 50.
Datadog's strategy of "landing and expanding" -- meaning it signs a customer onto a single service to cross-sell additional services -- is working. At the end of the fourth quarter, 22% of its customers were using four or more of its services, up from just 10% a year earlier. Its net retention rate, which gauges its revenue growth per existing customer, has remained above 130% for 14 straight quarters.
Datadog posted an adjusted net profit of $71.6 million for the full year, compared to a net loss of $471,000 in 2019. But unlike Adobe, Datadog remains deeply unprofitable on a GAAP basis, which includes its stock-based compensation and other one-time expenses.
Datadog expects its revenue to increase 37%-38% in 2021, but for its adjusted earnings to decline 36%-55% as it integrates two recent acquisitions and ramps up its spending. Based on those expectations, Datadog trades at nearly 350 times forward earnings and over 30 times this year's sales.
The winner: Adobe
I believe Datadog still has room to grow over the long term, but it's a weaker investment than Adobe right now.
Adobe's stock is cheaper, and it expects its revenue growth to accelerate slightly this year as the pandemic-related headwinds for its Digital Experience unit fade. Datadog's stock is pricey relative to its growth, and its valuations will be tough to justify this year as its revenue growth decelerates and its profits decline. The ongoing rotation from growth stocks could exacerbate that pain.
Therefore, it's fairly safe to buy a large position or accumulate more shares in Adobe right now, but I'd only recommend nibbling on Datadog at these frothy levels.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Leo Sun has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Adobe Systems and Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Adobe Systems (NASDAQ: ADBE) and Datadog (NASDAQ: DDOG) both generated impressive returns for investors over the past 12 months. But Adobe, which successfully transformed its portfolio of desktop-based software into cloud-based services over the past eight years, also posted solid growth for a 28-year-old tech giant. Demand for its Creative and Document Cloud services remained broadly stable throughout the year, even as some of its end markets -- including the entertainment industry -- experienced disruptions during the pandemic.
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Adobe Systems (NASDAQ: ADBE) and Datadog (NASDAQ: DDOG) both generated impressive returns for investors over the past 12 months. The differences between Adobe and Datadog Adobe generated 72% of its revenue from its Digital Media segment, which houses its Creative and Document clouds, in fiscal 2020. Adobe generates stable growth at a reasonable price Adobe's revenue increased 15% to $12.9 billion in 2020, as its Digital Media and Digital Experience revenue rose 20% and 12%, respectively.
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Adobe Systems (NASDAQ: ADBE) and Datadog (NASDAQ: DDOG) both generated impressive returns for investors over the past 12 months. As rising bond yields spark a rotation from growth stocks to value stocks, will Datadog remain the better investment this year? The differences between Adobe and Datadog Adobe generated 72% of its revenue from its Digital Media segment, which houses its Creative and Document clouds, in fiscal 2020.
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Adobe Systems (NASDAQ: ADBE) and Datadog (NASDAQ: DDOG) both generated impressive returns for investors over the past 12 months. Adobe generates stable growth at a reasonable price Adobe's revenue increased 15% to $12.9 billion in 2020, as its Digital Media and Digital Experience revenue rose 20% and 12%, respectively. It expects its revenue and adjusted earnings to grow 18% and 11%, respectively, in 2021.
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3bb9d850-6e7f-4eea-a529-71fefd159c45
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718889.0
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2021-03-15 00:00:00 UTC
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Why Datadog Stock Rose Monday
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DDOG
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https://www.nasdaq.com/articles/why-datadog-stock-rose-monday-2021-03-15
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nan
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nan
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What happened
Shares of Datadog (NASDAQ: DDOG) jumped on Monday on seemingly no company-related news. The cloud-based software platform company's shares may have risen as some investors are moving back into tech stocks, after exiting the sector over the past couple of weeks.
The tech stock was up by 5.8% as of 3:16 p.m. EDT.
So what
Toward the end of February, investors started exiting the tech sector as bond yields began to rise. To some investors, the rising yield rates indicated that the economy was picking up momentum and that other sectors outside of tech might soon start growing as well.
Image source: Getty Images.
That led to many investors selling off technology stocks and investing in other, more stable, sectors. But it appears that this trend may be reversing -- at least for now.
Technology stocks started gaining ground again last week and that rally looks like it's extending into this week as well. Datadog's share price bump is likely a result of investors thinking once again that high-growth tech stocks are the best place to put their money right now.
Now what
Datadog investors should be cautious not to buy or sell their shares simply based on the price of bond yields, or any other daily news for that matter. The company reported strong revenue growth of 56% in the fourth quarter (reported on Feb. 11) and both sales and earnings beat Wall Street's consensus estimates. Remember that some fluctuations in the market are normal and long-term investors shouldn't be too focused on those share price changes either way.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Chris Neiger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Monday on seemingly no company-related news. The cloud-based software platform company's shares may have risen as some investors are moving back into tech stocks, after exiting the sector over the past couple of weeks. Datadog's share price bump is likely a result of investors thinking once again that high-growth tech stocks are the best place to put their money right now.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Monday on seemingly no company-related news. So what Toward the end of February, investors started exiting the tech sector as bond yields began to rise. That led to many investors selling off technology stocks and investing in other, more stable, sectors.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Monday on seemingly no company-related news. The cloud-based software platform company's shares may have risen as some investors are moving back into tech stocks, after exiting the sector over the past couple of weeks. Datadog's share price bump is likely a result of investors thinking once again that high-growth tech stocks are the best place to put their money right now.
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What happened Shares of Datadog (NASDAQ: DDOG) jumped on Monday on seemingly no company-related news. So what Toward the end of February, investors started exiting the tech sector as bond yields began to rise. Now what Datadog investors should be cautious not to buy or sell their shares simply based on the price of bond yields, or any other daily news for that matter.
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45a30481-8bb5-48c9-a1a7-899cc9adcc08
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718890.0
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2021-03-15 00:00:00 UTC
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Why These 2 High-Growth Favorites Lifted the Nasdaq Monday
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DDOG
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https://www.nasdaq.com/articles/why-these-2-high-growth-favorites-lifted-the-nasdaq-monday-2021-03-15
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nan
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nan
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Stock markets have been hitting record highs lately, but the Nasdaq Composite (NASDAQINDEX: ^IXIC) has lagged behind. Even on Monday afternoon, when the Nasdaq was up 0.2% as of 1:30 p.m. EDT, the favorite benchmark among high-growth investors still languished almost 5% below its recent all-time highs.
Nevertheless, many of the growth stocks in the Nasdaq are performing well to start the new week, and investors have high hopes that they could provide the leadership to send the index to record levels once again. Below, we'll look more closely to see why Align Technology (NASDAQ: ALGN) and Datadog (NASDAQ: DDOG) posted sizable gains on Monday.
Align gets paid -- more
Shares of Align Technology were up nearly 4% Monday afternoon. The maker of Invisalign clear aligners for orthodontic work got good news that should result in a nice boost to an already impressive cash award resulting from disputes against a key competitor.
Align has all the smiles today. Image source: Getty Images.
Align received a favorable outcome in binding arbitration against SmileDirectClub (NASDAQ: SDC) and various parties related to that company. Align previously held an ownership interest in SmileDirectClub, and a prior arbitration order had required Align to sell that interest back to SmileDirectClub. Align disagreed with SmileDirectClub's initial determination of the value of that interest, and although SmileDirectClub had already paid $54.2 million to date, Align wanted more.
That's exactly what Align got Monday, as the arbitrator ordered SmileDirectClub to pay an additional $45.5 million to Align to reflect the higher valuation plus interest. In addition, further interest will accrue at a rate of $3,000 per day until the amount is paid in full.
The two companies have worked hard to disentangle themselves from their past relationship for a long time now. Going forward, SmileDirectClub and Align will be competitors, and that competition could turn cutthroat given the extended disagreements between the two orthodontic device specialists.
Datadog gets a treat
Meanwhile, in the software-as-a-service space, Datadog saw its stock rise nearly 6%. Even with the upward move, the stock has regained only a small part of the ground it has lost since mid-February, but investors are increasingly optimistic that Datadog can build upward momentum.
Datadog grew dramatically during the COVID-19 pandemic, as cloud-based analytics became even more important without more traditional sources of business information and intelligence available. The company nearly doubled the number of million-dollar customers it has, and the ongoing trend toward digital transformation should make its services equally valuable going forward.
Some investors are concerned that once the pandemic comes under control, Datadog could lose a key tailwind that has helped accelerate its growth. But there's reason to believe that Datadog's best days aren't over just yet. Datadog hasn't been scared to spend up on research and development, even if it means giving up current profitability as a result. Long-term investors are more confident that deferring gratification by accepting red ink for a little while longer will pay off with better profits in the years to come.
Both Datadog and Align understand that when a business is working, it pays to stick with it. Shareholders are reaping the rewards today, and further gains could be ahead if Align and Datadog can keep up their operational excellence.
10 stocks we like better than Align Technology
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Align Technology wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Dan Caplinger owns shares of Datadog. The Motley Fool owns shares of and recommends Align Technology and Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Below, we'll look more closely to see why Align Technology (NASDAQ: ALGN) and Datadog (NASDAQ: DDOG) posted sizable gains on Monday. Even on Monday afternoon, when the Nasdaq was up 0.2% as of 1:30 p.m. EDT, the favorite benchmark among high-growth investors still languished almost 5% below its recent all-time highs. Nevertheless, many of the growth stocks in the Nasdaq are performing well to start the new week, and investors have high hopes that they could provide the leadership to send the index to record levels once again.
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Below, we'll look more closely to see why Align Technology (NASDAQ: ALGN) and Datadog (NASDAQ: DDOG) posted sizable gains on Monday. That's exactly what Align got Monday, as the arbitrator ordered SmileDirectClub to pay an additional $45.5 million to Align to reflect the higher valuation plus interest. The Motley Fool owns shares of and recommends Align Technology and Datadog.
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Below, we'll look more closely to see why Align Technology (NASDAQ: ALGN) and Datadog (NASDAQ: DDOG) posted sizable gains on Monday. Align previously held an ownership interest in SmileDirectClub, and a prior arbitration order had required Align to sell that interest back to SmileDirectClub. Align disagreed with SmileDirectClub's initial determination of the value of that interest, and although SmileDirectClub had already paid $54.2 million to date, Align wanted more.
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Below, we'll look more closely to see why Align Technology (NASDAQ: ALGN) and Datadog (NASDAQ: DDOG) posted sizable gains on Monday. Align gets paid -- more Shares of Align Technology were up nearly 4% Monday afternoon. Both Datadog and Align understand that when a business is working, it pays to stick with it.
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592e3397-e4f8-4526-9b40-fa04469c3c36
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718891.0
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2021-03-09 00:00:00 UTC
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Unity Software’s Valuation Depends on High Free Cash Flow Margins
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DDOG
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https://www.nasdaq.com/articles/unity-softwares-valuation-depends-on-high-free-cash-flow-margins-2021-03-09
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nan
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nan
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Unity Software (NYSE:U), which makes a real-time 3D software development platform, released strong quarterly results for the year ending Dec. 31, 2020. And for the second quarter in a row, it has now produced positive free cash flow (FCF). That is important, since U stock has a very high market capitalization that depends on making high FCF margins in the next several years.
Source: Konstantin Savusia / Shutterstock.com
On Feb. 4, Unity Software released its Q4 and full-year 2020 results. It showed net income losses, including on a non-GAAP basis. But most importantly the company made $14.8 million in cash flow from operations (CFFO) and $3.6 million in Q4.
Projecting Unity’s Value Using FCF
This was the second quarter the company made positive FCF. In Q3 Unity Software produced $10.9 million in FCF. Nevertheless, the company still ended up with negative $20 million in FCF in 2020 from earlier FCF losses.
Moreover, its FCF margins are nowhere near enough now to justify U stock’s existing $25.66 billion market value. For example, even if the software company had a 1% FCF yield, that would imply annual run-rate FCF was $256.6 million (i.e, 0.01 times $25.66 billion). Therefore, making $3.6 million or even $10.9 million in FCF in quarterly FCF will not get it to $257 million annually in FCF.
7 Hot Stocks Ready to Ride Retail Growth
However, we can work out when this might happen, given Unity Software’s fast-growing revenue. For example, by 2023 analysts surveyed by Seeking Alpha project that revenue will hit $1.61 billion. That represents a gain of 108% over revenue in 2020 of $772.5 million and 67.7% over 2021 forecast sales of $960 million.
Therefore if Unity Software can produce 20% FCF margins by 2023, its FCF will hit $322 million (i.e., 0.20 times $1.61 revenue in 2023). And following that, if we assume that by then U stock will trade at a 1% FCF yield, the market cap will be $32.2 billion. This is seen by dividing $322 million by 0.01.
As a result, in three years, assuming a 20% FCF margin and using analysts’ sales forecasts, Unity’s stock could rise by 25%.
Implied Values With Various FCF Margins
That represents a potential price of $117.73 by 2023. However, this represents a compound annual return of just 7.86% per year. That is nothing to write home about.
We can take this one step further. Analysts project sales to reach $2.09 billion by 2024. Therefore, using a 20% margin, FCF might hit $418 million. And using a 1% FCF yield implies a market value of $41.8 billion, or 62.9% above today’s price. That represents an average annual return of 13% per annum in each of the four years to 2024.
That is a good ROI, but not a great one. What this means is that the market must believe that Unity Software will likely make greater than 20% FCF margins over the next several years.
In other words, the 20% FCF margin level is sort of a minimum level justifying Unity’s huge market cap today. In reality, it is going to need to make around 30% or higher FCF margins if the stock is going to move significantly higher.
For example, let’s assume it makes 30% FCF margins by 2023 with $1.61 billion in sales. That implies FCF of $483 million and a market cap of $48.3 billion using a 1.0% FCF yield metric. That is 88.2% over today’s price and implies a target price of $176.56 by 2023. If that happens, then an investor would make an average annual return of 23.5% over each of the next three years.
What To Do With U Stock
To summarize, assuming Unity Software makes 20% FCF margins by 2023, the stock should be worth at least $117.73. But if it makes 30% margins by then, the market would likely value U stock at $176.56 per share.
In the first case, this represents an average annual return of just 7.9% each of the three years. But using a 30% FCF margin assumption, the stock return produces an average 23.5% annual return each year.
Therefore, you can see why the company emphasizes free cash flow so clearly in its earnings release. Unity said it has “dedication to a path to free cash flow break-even.”
It knows that its $25 billion-plus market value today depends very highly on not only getting FCF breakeven but then pulling in high FCF margins.
This is going to be a big feat to pull off. For example, a similar software company Datadog (NASDAQ:DDOG) made $22.7 million in FCF in its latest quarter on $177.5 million in revenue. That represents 12.8% FCF margins. DDOG stock has a similar $25.19 billion market cap.
However, Slack Technologies (NYSE:WORK) made just 6% FCF margins on its $250.6 million in quarterly revenue. It received a $27.7 billion takeover offer from Salesforce.com (NYSE:CRM) at the beginning of this year.
Obviously, CRM believes that its margins will eventually be much higher. But this goes to show that getting to at least a 10 to 12% FCF margin will justify Unity Software’s existing market cap.
On the date of publication, Mark R. Hake did not hold a long or short position in any of the securities in this article.
Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guide which you can review here.
The post Unity Software’s Valuation Depends on High Free Cash Flow Margins appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For example, a similar software company Datadog (NASDAQ:DDOG) made $22.7 million in FCF in its latest quarter on $177.5 million in revenue. DDOG stock has a similar $25.19 billion market cap. 7 Hot Stocks Ready to Ride Retail Growth However, we can work out when this might happen, given Unity Software’s fast-growing revenue.
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For example, a similar software company Datadog (NASDAQ:DDOG) made $22.7 million in FCF in its latest quarter on $177.5 million in revenue. DDOG stock has a similar $25.19 billion market cap. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Unity Software (NYSE:U), which makes a real-time 3D software development platform, released strong quarterly results for the year ending Dec. 31, 2020.
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For example, a similar software company Datadog (NASDAQ:DDOG) made $22.7 million in FCF in its latest quarter on $177.5 million in revenue. DDOG stock has a similar $25.19 billion market cap. Therefore, making $3.6 million or even $10.9 million in FCF in quarterly FCF will not get it to $257 million annually in FCF.
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For example, a similar software company Datadog (NASDAQ:DDOG) made $22.7 million in FCF in its latest quarter on $177.5 million in revenue. DDOG stock has a similar $25.19 billion market cap. In Q3 Unity Software produced $10.9 million in FCF.
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b831ba84-420c-4365-80bc-d6c4088d0860
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718892.0
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2021-03-09 00:00:00 UTC
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Is Splunk Stock a Buy?
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DDOG
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https://www.nasdaq.com/articles/is-splunk-stock-a-buy-2021-03-09
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nan
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nan
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Because of the accounting shenanigans that transpired during its transition from a license-based on-premises offering to a subscription-based cloud model, Splunk (NASDAQ: SPLK) posted confusing fiscal fourth-quarter results last week. Despite a strong and reassuring performance from its cloud business, revenue declined year over year.
So at more than 30% below its summer all-time highs, is Splunk stock a buy?
Splunk goes from on-premises to the cloud
A decade ago, Splunk's core business consisted of providing on-premises Security Incident Event Management (SIEM) solutions for enterprises to centralize and analyze the information generated by their servers, networking gears, and computing infrastructure devices.
Image source: Getty Images.
Thanks to internal developments and acquisitions over the last several years, the company has expanded its business with extra security and monitoring capabilities. Splunk also developed an observability platform to help developers better measure the performance and health of their systems and applications.
These decisions made sense given the significant synergies and cross-selling opportunities between these different products, which can be integrated and sold under a unified platform.
But Splunk's most important transition remains the shift to the cloud it initiated three years ago. With the rise of cloud computing, many competitors offered cloud-native monitoring and observability capabilities Splunk couldn't compete with. For instance, the monitoring specialist Datadog generated impressive top-line growth, going from $101 million in 2017 to $603 million last year, as it captured new cloud opportunities thanks to its user-friendly integrated monitoring and observability platform.
Financial consequences of the cloud transition
So Splunk developed a competitive cloud-native offering to remain relevant in cloud computing environments. So far, the transition has gone well -- the research outfit GigaOm cited Splunk as a leader in cloud observability in its 2021 report.
But that transition has had drawbacks for the company's results under generally accepted accounting principles (GAAP). Instead of selling licenses and generating large upfront payments that are immediately recognized as revenue, cloud service subscriptions are recognized over time. Thus, as long as subscriptions are still replacing licenses, Splunk will report weak revenue growth. And with licenses still representing a large portion of total revenue, that transition will span over several extra quarters.
Indeed, during the last quarter revenue dropped 6% year over year to $745 million, as 72% year-over-year growth in cloud (ratable) revenue to $171 million failed to fully offset the 22% decline to $406 million in revenue from licenses.
In addition, the company's transition to the cloud implies lower gross margins. In contrast with its legacy license business, which requires customers to support the costs of their computing infrastructure to run Splunk's software, Splunk must provide -- and pay for -- the infrastructure that delivers its cloud-based solutions.
As a result, non-GAAP (adjusted) gross margin declined to 83% during the last quarter, down from 87% in the prior-year period, as growing cloud services led to a non-GAAP gross margin of 62%.
Granted, as its services scale up, management plans to improve cloud non-GAAP gross margins to at least 75% over the long term. But that remains well below the spectacular gross margins in the 90% area that the company generated with its legacy license business in the past.
Thus Splunk remains far from profitability. During its fiscal year 2021, ending on Jan. 31, GAAP net losses increased to $908 million, compared to $337 million the year before, partly because of declining revenue and increasing operating costs. Looking forward, reduced gross margins associated with cloud services will represent an extra obstacle standing in the way of profitability.
Splunk stock is not a bargain yet
In addition to those financial challenges, Splunk's transition to the cloud remains a work in progress. And because of uncertainties, management didn't provide a full-year outlook.
So at an enterprise value-to-sales ratio of 10.6, the tech stock remains pricey. It doesn't look expensive compared to the lofty valuations of high-growth cloud-native competitors. But those competitors don't have to deal with legacy on-premises businesses, and Splunk's valuation still sets strong expectations that have yet to be borne out.
Besides, other cloud players have been integrating security, monitoring, and observability capabilities into unified data platforms that increasingly compete with Splunk's offering. For instance, Datadog announced new cybersecurity capabilities last year. And the endpoint protection specialist CrowdStrike recently agreed to acquire the observability specialist Humio to enhance its cybersecurity platform.
Thus, even at more than 30% below its all-time high from last summer, Splunk stock is still not a buy for me.
10 stocks we like better than Splunk
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Splunk wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Herve Blandin has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends CrowdStrike Holdings, Inc., Datadog, and Splunk. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Because of the accounting shenanigans that transpired during its transition from a license-based on-premises offering to a subscription-based cloud model, Splunk (NASDAQ: SPLK) posted confusing fiscal fourth-quarter results last week. With the rise of cloud computing, many competitors offered cloud-native monitoring and observability capabilities Splunk couldn't compete with. Besides, other cloud players have been integrating security, monitoring, and observability capabilities into unified data platforms that increasingly compete with Splunk's offering.
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Splunk goes from on-premises to the cloud A decade ago, Splunk's core business consisted of providing on-premises Security Incident Event Management (SIEM) solutions for enterprises to centralize and analyze the information generated by their servers, networking gears, and computing infrastructure devices. With the rise of cloud computing, many competitors offered cloud-native monitoring and observability capabilities Splunk couldn't compete with. Besides, other cloud players have been integrating security, monitoring, and observability capabilities into unified data platforms that increasingly compete with Splunk's offering.
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Splunk goes from on-premises to the cloud A decade ago, Splunk's core business consisted of providing on-premises Security Incident Event Management (SIEM) solutions for enterprises to centralize and analyze the information generated by their servers, networking gears, and computing infrastructure devices. Indeed, during the last quarter revenue dropped 6% year over year to $745 million, as 72% year-over-year growth in cloud (ratable) revenue to $171 million failed to fully offset the 22% decline to $406 million in revenue from licenses. Splunk stock is not a bargain yet In addition to those financial challenges, Splunk's transition to the cloud remains a work in progress.
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For instance, the monitoring specialist Datadog generated impressive top-line growth, going from $101 million in 2017 to $603 million last year, as it captured new cloud opportunities thanks to its user-friendly integrated monitoring and observability platform. But that remains well below the spectacular gross margins in the 90% area that the company generated with its legacy license business in the past. That's right -- they think these 10 stocks are even better buys.
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8d40d9f7-7633-4baf-90dd-f30239707c33
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718893.0
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2021-03-05 00:00:00 UTC
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Datadog is Now Oversold (DDOG)
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DDOG
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https://www.nasdaq.com/articles/datadog-is-now-oversold-ddog-2021-03-05
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nan
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nan
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Legendary investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful. One way we can try to measure the level of fear in a given stock is through a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In trading on Friday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 28.5, after changing hands as low as $78.09 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 39.2. A bullish investor could look at DDOG's 28.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares:
Looking at the chart above, DDOG's low point in its 52 week range is $28.88 per share, with $119.433 as the 52 week high point — that compares with a last trade of $79.71.
Free Report: Top 7%+ Dividends (paid monthly)
Find out what 9 other oversold stocks you need to know about »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A bullish investor could look at DDOG's 28.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $28.88 per share, with $119.433 as the 52 week high point — that compares with a last trade of $79.71. In trading on Friday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 28.5, after changing hands as low as $78.09 per share.
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A bullish investor could look at DDOG's 28.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $28.88 per share, with $119.433 as the 52 week high point — that compares with a last trade of $79.71. In trading on Friday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 28.5, after changing hands as low as $78.09 per share.
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In trading on Friday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 28.5, after changing hands as low as $78.09 per share. A bullish investor could look at DDOG's 28.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $28.88 per share, with $119.433 as the 52 week high point — that compares with a last trade of $79.71.
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In trading on Friday, shares of Datadog Inc (Symbol: DDOG) entered into oversold territory, hitting an RSI reading of 28.5, after changing hands as low as $78.09 per share. A bullish investor could look at DDOG's 28.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. The chart below shows the one year performance of DDOG shares: Looking at the chart above, DDOG's low point in its 52 week range is $28.88 per share, with $119.433 as the 52 week high point — that compares with a last trade of $79.71.
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2717052a-08a0-4799-b1c8-dea4edf7d665
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718894.0
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2021-03-04 00:00:00 UTC
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Why Stocks Like HubSpot, Datadog, Fastly, CrowdStrike, and Criteo All Pulled Back Sharply Today
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DDOG
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https://www.nasdaq.com/articles/why-stocks-like-hubspot-datadog-fastly-crowdstrike-and-criteo-all-pulled-back-sharply
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nan
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nan
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What happened
While it's too soon to call this a bear market, the Nasdaq index officially entered correction territory on Thursday. A correction usually refers to a drop of 10% or more. As of 3 p.m. EST, the Nasdaq was down about 10.2% from all-time highs set in February. Therefore, with the tech-heavy index down so sharply, it wasn't surprising to see certain tech-stock darlings down today as well.
Stocks like customer relationship management company HubSpot (NYSE: HUBS), data-analytics business Datadog (NASDAQ: DDOG), content delivery network Fastly (NYSE: FSLY), cybersecurity operator CrowdStrike Holdings (NASDAQ: CRWD), and advertising-technology company Criteo (NASDAQ: CRTO) were all down between 5% and 10% as of this writing. Some had minor news to report. But by and large, they sold off with the market.
Image source: Getty Images.
So what
In some cases, there's actually some material news to report. Ad-tech companies like Criteo are reeling after Alphabet's Google announced big changes to how ads will be delivered. Last year, the company said the days of the third-party browser cookie were limited. But this tool was something it and other ad-tech companies relied on to deliver targeted ads to consumers for their customers.
The end of the third-party browser cookie prompted The Trade Desk to spearhead a movement called Unified ID 2.0, a project Criteo and many other companies had signed on to. However, in yesterday's announcement from Google, the company made it clear that it didn't believe in the cookie alternatives being developed. Rather, it seems keen on pursuing something called interest-based advertising (officially known as "federated learning of cohorts" or FLoC for short).
Many are taking this news from Google as a bad thing for Criteo and company. But this take is likely premature -- we don't know what the outcome will be yet. In fact, an analyst with Craig-Hallum thinks independent ad-tech companies like Criteo actually stand to benefit from Google's decision. But on down days for the market, investors prefer to focus on the negatives.
To further prove this point, consider CrowdStrike stock today. This morning, the company announced brand new features for its CrowdStrike Falcon platform. On days when greed is running wild on Wall Street, it wouldn't be surprising to see CrowdStrike stock pop on news like this. It's hard to know the financial impact, but new features that automate mundane tasks and improve the user experience could help CrowdStrike continue to gain market share in the industry.
However, when fear is running rampant (as it is today), nothing seems to make a stock go higher. And fear is why technology stocks like HubSpot, Datadog, Fastly, CrowdStrike, and Criteo were down today.
One-year returns for these technology stocks compared to the Nasdaq index. HUBS data by YCharts
Now what
On days like today, it's helpful to go back to the basics and remember some important truths. First, even after falling today, HubSpot, Datadog, Fastly, CrowdStrike, and Criteo have all been market-crushing investments over the past year. With market-beating investments like this, it's normal to expect sharp pullbacks now and again. In fact, we should be expecting them. And when stocks fall, they fall hard.
Here's some other sound investing principles to remember: If you were day trading, today would be devastating. Therefore, invest in good companies with the intention of holding them for years. And when investing with a long-term horizon, don't invest money you might need soon for a critical purchase and don't use margin. Otherwise, you may find yourself needing to sell at inopportune times.
When you're heeding solid principles like these, days like today don't wipe you out, allowing you to start looking for stocks you may want to buy at a discount. While we still have a long way to go for before stocks are screaming bargains, there's still plenty of good companies to invest in for less than you would have paid even just a couple weeks ago.
Finally, we can't predict whether today is the absolute bottom or not. Therefore, it's best to strap in and mentally prepare for more stock market volatility at some point in 2021.
Find out why CrowdStrike Holdings, Inc. is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
Tom and David just revealed their ten top stock picks for investors to buy right now. CrowdStrike Holdings, Inc. is on the list -- but there are nine others you may be overlooking.
Click here to get access to the full list!
*Stock Advisor returns as of February 24, 2021
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Jon Quast owns shares of Nasdaq. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), CrowdStrike Holdings, Inc., Datadog, Fastly, HubSpot, and The Trade Desk. The Motley Fool recommends Criteo and Nasdaq. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks like customer relationship management company HubSpot (NYSE: HUBS), data-analytics business Datadog (NASDAQ: DDOG), content delivery network Fastly (NYSE: FSLY), cybersecurity operator CrowdStrike Holdings (NASDAQ: CRWD), and advertising-technology company Criteo (NASDAQ: CRTO) were all down between 5% and 10% as of this writing. The end of the third-party browser cookie prompted The Trade Desk to spearhead a movement called Unified ID 2.0, a project Criteo and many other companies had signed on to. It's hard to know the financial impact, but new features that automate mundane tasks and improve the user experience could help CrowdStrike continue to gain market share in the industry.
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Stocks like customer relationship management company HubSpot (NYSE: HUBS), data-analytics business Datadog (NASDAQ: DDOG), content delivery network Fastly (NYSE: FSLY), cybersecurity operator CrowdStrike Holdings (NASDAQ: CRWD), and advertising-technology company Criteo (NASDAQ: CRTO) were all down between 5% and 10% as of this writing. And fear is why technology stocks like HubSpot, Datadog, Fastly, CrowdStrike, and Criteo were down today. First, even after falling today, HubSpot, Datadog, Fastly, CrowdStrike, and Criteo have all been market-crushing investments over the past year.
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Stocks like customer relationship management company HubSpot (NYSE: HUBS), data-analytics business Datadog (NASDAQ: DDOG), content delivery network Fastly (NYSE: FSLY), cybersecurity operator CrowdStrike Holdings (NASDAQ: CRWD), and advertising-technology company Criteo (NASDAQ: CRTO) were all down between 5% and 10% as of this writing. Find out why CrowdStrike Holdings, Inc. is one of the 10 best stocks to buy now Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), CrowdStrike Holdings, Inc., Datadog, Fastly, HubSpot, and The Trade Desk.
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Stocks like customer relationship management company HubSpot (NYSE: HUBS), data-analytics business Datadog (NASDAQ: DDOG), content delivery network Fastly (NYSE: FSLY), cybersecurity operator CrowdStrike Holdings (NASDAQ: CRWD), and advertising-technology company Criteo (NASDAQ: CRTO) were all down between 5% and 10% as of this writing. First, even after falling today, HubSpot, Datadog, Fastly, CrowdStrike, and Criteo have all been market-crushing investments over the past year. Find out why CrowdStrike Holdings, Inc. is one of the 10 best stocks to buy now Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market.
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b6e31477-f83e-4d20-8885-067f0a653ae2
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718895.0
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2021-03-02 00:00:00 UTC
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Is Datadog a Buy?
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DDOG
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https://www.nasdaq.com/articles/is-datadog-a-buy-2021-03-02
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nan
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nan
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Cloud stocks have seen quite the run lately, and Datadog (NASDAQ: DDOG) is no exception. The stock price has more than doubled since its debut in September 2019, and it carries a lofty valuation. But investors haven't missed out.
The best days for this cloud monitoring platform are yet to come. Let's dive into why you may want to pay up for this investing gem.
The business of cloud monitoring
Datadog founders Alexis Lê-Quôc (left) and Olivier Pomel. Image source: Datadog.
Datadog was founded in 2010 by two information technology professionals who worked in different areas. Alexis Lê-Quôc and Olivier Pomel found that the department (development or operations) they worked in colored their perspectives and often made it difficult to find common ground. They started Datadog "to build a real-time data integration platform to turn chaos from disparate sources into digestible and actionable insights" and break down the silos between departments.
The platform started with a single unified data model and robust visualization tools that provided a solid foundation to build on. It added infrastructure monitoring in 2012, application performance monitoring in 2017, log management in 2018, and user experience monitoring in 2019. But it hasn't stopped growing its platform. With the recent acquisitions of Sqeel and Timber, its platform is becoming even more robust. This innovative set of application and technology monitoring services is becoming a must-have toolset for its customers in the cloud age.
The incredible growth engines
The company's broad set of products is winning new customers. It added 3,700 customers in 2020, a 35% gain to bring its total to 14,200. But its existing customers made up a solid portion of revenue growth as demonstrated by a strong and consistent 130% net dollar retention rate. A whopping 72% of customers use two or more of its products, up from 58% a year ago. A solid 22% of customers are using four or more modules, more than double the 10% rate from the end of 2019. No wonder the company has been able to post 50% plus revenue gains over the last three years and seen a robust growth of its already large contingent of $100,000-plus-in-annual-revenue customers.
METRICS
2018
2019
2020
Revenue
$140 million
$114 million
$604 million
YOY growth
68%
85%
56%
$100,000 ARR customers at year-end
453
858
1,253
YOY growth
90%
89%
46%
Data source: Company earnings releases. YOY=Year-over-year. ARR = annual recurring revenue.
But that's not all. In its most recent quarter, 75% of new customers are starting out with two or more modules. This shows that the company's integrated platform is being recognized for the value it brings even for its newest clients.
Growing into a massive market
The market for cloud monitoring software is fairly new, but it's not small by any means. In the company's prospectus from September 2019, it estimated its addressable market was $35 billion. Given its $604 million in trailing 12-month revenue, it has plenty of opportunities to continue to grow for many years to come. But the company is not resting on its laurels.
Image source: Getty Images.
It spent $210 million in 2020 on research and development efforts to enhance its platform. This represents a strong 35% of revenue and helps keep existing customers on the platform by providing a constant stream of new features. It also spent $213 million on sales and marketing to attract and retain customers. Additionally, its new acquisitions (mentioned above) not only enhance the platform's capabilities, but expand its addressable market as well.
The company is plowing all of its profits into growth efforts, racking up $16.7 million in losses for 2020. But the strong balance sheet with $774 million in cash and marketable securities will enable the company to continue to fund growth efforts for many years to come.
Is Datadog a buy?
Datadog stock isn't cheap by any stretch, with a price-to-sales ratio at a lofty 49. But the runway of growth for the cloud monitoring specialist is long, and its history of innovation and customer adoption proves it can continue to win going forward. This stock is a buy for investors who are interested in playing the long-term trend of cloud adoption.
But one word of warning. Growth stocks with high valuations like this one often experience significant price swings (both up and down). If you like what you see, buy a small position and add to it over time. I'm sure that as an owner of this "dog," it will bring you many years of happiness (and profit).
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Brian Withers owns shares of Datadog. The Motley Fool owns shares of and recommends Datadog. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Cloud stocks have seen quite the run lately, and Datadog (NASDAQ: DDOG) is no exception. Alexis Lê-Quôc and Olivier Pomel found that the department (development or operations) they worked in colored their perspectives and often made it difficult to find common ground. They started Datadog "to build a real-time data integration platform to turn chaos from disparate sources into digestible and actionable insights" and break down the silos between departments.
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Cloud stocks have seen quite the run lately, and Datadog (NASDAQ: DDOG) is no exception. The business of cloud monitoring Datadog founders Alexis Lê-Quôc (left) and Olivier Pomel. Alexis Lê-Quôc and Olivier Pomel found that the department (development or operations) they worked in colored their perspectives and often made it difficult to find common ground.
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Cloud stocks have seen quite the run lately, and Datadog (NASDAQ: DDOG) is no exception. No wonder the company has been able to post 50% plus revenue gains over the last three years and seen a robust growth of its already large contingent of $100,000-plus-in-annual-revenue customers. 2018 2019 2020 Revenue $140 million $114 million $604 million YOY growth 68% 85% 56% $100,000 ARR customers at year-end 453 858 1,253 YOY growth 90% 89% 46% Data source: Company earnings releases.
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Cloud stocks have seen quite the run lately, and Datadog (NASDAQ: DDOG) is no exception. No wonder the company has been able to post 50% plus revenue gains over the last three years and seen a robust growth of its already large contingent of $100,000-plus-in-annual-revenue customers. 2018 2019 2020 Revenue $140 million $114 million $604 million YOY growth 68% 85% 56% $100,000 ARR customers at year-end 453 858 1,253 YOY growth 90% 89% 46% Data source: Company earnings releases.
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cc065e88-3bef-4306-a394-3a80cbcc95b6
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718896.0
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2021-03-01 00:00:00 UTC
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5 Tech Stocks Billionaires Can't Stop Buying
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DDOG
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https://www.nasdaq.com/articles/5-tech-stocks-billionaires-cant-stop-buying-2021-03-01
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nan
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nan
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Possibly the most exciting day for investors during the first quarter has come and gone.
Less than two weeks ago, the deadline hit for money managers with over $100 million in assets under management to file Form 13F with the Securities and Exchange Commission. A 13F provides a detailed look at what the brightest and most successful money managers were holding at the end of the most recent quarter. Even though these filings are dated (i.e., they show what was held six or more weeks earlier), they can nevertheless cue Wall Street and investors onto stocks or trends that have the attention of money managers.
After perusing many of the moves made by billionaire money managers, one trend stands out: They're high on technology. In particular, billionaires couldn't stop buying the following five tech stocks during the fourth quarter.
Image source: Getty Images.
Palantir Technologies
With data-mining company Palantir Technologies (NYSE: PLTR) becoming a public company via direct listing at the tail-end of the third quarter, it's not really a huge surprise to see ownership statistics among 13F filers skyrocket. In total, 137% more funds were holding Palantir at the end of the year, compared to Sept. 30, and aggregate ownership jumped 82% to 321.8 million shares, according to WhaleWisdom.com. We witnessed both Larry Fink's BlackRock and Jeff Yass's Susquehanna International pile into Palantir, with respective purchases of 4.05 million and 3.94 million shares.
Wall Street's bullishness has certainly been rewarded with exceptional growth prospects. Palantir grew sales by 47% in 2020 to roughly $1.1 billion, and it's calling for 45% growth in the first quarter from the prior-year period. Large military/government contract wins for the company's Gotham platform have been key to Palantir's outperformance.
What remains to be seen if Palantir can maintain such a lofty valuation. Even if it were to grow sales by 40% in 2021, it'd still be valued at close to 24 times sales. The operating performance of Palantir's enterprise-focused analytics platform (Foundry) may be what buoys or trips up the company in 2021.
Image source: Getty Images.
Fastly
Billionaire investors aren't afraid of a wild ride, as long as the growth prospects are worth it. Edge cloud services provider Fastly (NYSE: FSLY) was a big-money favorite in Q4, with aggregate ownership among 13F filers increasing by 18% to 66.2 million shares from Q3 2020. More specifically, Susquehanna more than doubled its existing stake in Fastly, while BlackRock picked up almost 331,000 additional shares.
The optimism surrounding Fastly has to do with businesses shifting online and into the cloud, and consumers altering their consumption habits. Since it's Fastly's job to securely speed up the process by which content reaches end users, the pandemic has accelerated this existing online shift. Not surprisingly, sales rocketed 45% higher in 2020 to $291 million, with adjusted gross margin increasing 430 basis points to 60.9%.
On the bright side, the company's dollar-based net expansion rate of 147% and 143% in Q3 and Q4 suggest that its existing clients are growing quickly, which is fantastic news for gross margin expansion. However, the company's fourth-quarter sales growth was aided by an acquisition, and total customer growth slowed considerably. If Fastly is to maintain its premium valuation -- which is something I believe it can do -- it's going to need customer growth to pick up in the early part of 2021.
Image source: Getty Images.
Datadog
Another tech stock with a bulls-eye on its proverbial back is application performance monitoring company Datadog (NASDAQ: DDOG). In total, 13F filers increased their holdings in this software-as-a-service stock by 17% (about 23 million shares) from the sequential third quarter. Billionaire Stephen Mandel's Lone Pine Capital picked up an additional 541,225 shares in Q4, while BlackRock added just over 2 million shares.
Similar to Fastly, the buzz around Datadog has to do with the coronavirus pandemic accelerating shifts that were already under way. For Datadog, we're talking about businesses shifting into the cloud and/or remote-work environments. Being able to use Datadog's cloud-based software to better understand consumer behaviors, expedite problem-solving, and improve the understanding of key business metrics, is now more important than ever.
Datadog has certainly delivered, with sales jumping 66% in 2020 to $603.5 million. But what's even more impressive is that the number of customers with annual recurring revenue (ARR) above $1 million nearly doubled to 97 from 50, while customers with an ARR over $100,000 jumped by 46% from the previous year. This suggests Datadog is attracting bigger clients and effectively scaling with its fast-growing customers.
Image source: Getty Images.
Snowflake
Cloud data warehousing stock Snowflake (NYSE: SNOW) was also popular among billionaire investors during the fourth quarter. Like Palantir, it debuted in September, so we weren't able to see a full quarter of optimism reflected in the previous round of 13F filings. In Q4, aggregate ownership by 13F filers increased by 14%, with 101 additional funds adding it as a holding. Among billionaires, Chase Coleman's Tiger Global Management and Yass's Susquehanna each added a bit over 500,000 shares.
What allows Snowflake to stand out is the uniqueness of its operating model. For example, Snowflake shuns the subscription model and allows its clients to pay based on the storage and Snowflake Compute Credits they use. Also, since Snowflake's architecture is layered atop many of the most-popular storage services, it breaks down the difficulties of sharing cloud data across rival platforms.
But like Palantir, Snowflake has some serious questions to answer regarding its valuation. Third-quarter sales (ended Oct. 31) rocketed 115% higher, with existing clients spending 62% more than they did in the prior-year quarter. But even if Snowflake nearly doubles its sales in its next fiscal year, it'll still be valued at north of 65 times sales. Snowflake's operating results will likely need to blow Wall Street's socks off to maintain its premium valuation.
Image source: Getty Images.
CrowdStrike Holdings
Finally, billionaire money managers simply couldn't stay away from cybersecurity stock CrowdStrike Holdings (NASDAQ: CRWD). Despite aggregate ownership among 13F filers only increasing 6%, the total number of funds holding CrowdStrike at the end of the quarter rocketed 24% higher. BlackRock bought over 2 million shares, with Gabe Plotkin's Melvin Capital Management opening a 750,000-share position.
What makes CrowdStrike such a fantastic company is its cloud-native security platform, Falcon. This platform evaluates over 3 trillion events each week, and with the help of artificial intelligence becomes more effective at identifying and responding to threats. Because it's entirely cloud-based, CrowdStrike's security solutions are often cheaper and faster to respond than on-premises solutions.
Despite being fundamentally pricey, CrowdStrike looks to be worth every penny. Over a 14-quarter stretch between the first quarter of fiscal 2018 and the third quarter of fiscal 2021, the percentage of customers that had a least four cloud module subscriptions jumped from 9% to 61%. This shows how trusted CrowdStrike's cybersecurity solutions have become, as well as how easily it's built to scale with its clients.
10 stocks we like better than Datadog
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Datadog wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
Sean Williams has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends CrowdStrike Holdings, Inc., Datadog, Fastly, and Snowflake Inc. The Motley Fool owns shares of Palantir Technologies Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Datadog Another tech stock with a bulls-eye on its proverbial back is application performance monitoring company Datadog (NASDAQ: DDOG). Even though these filings are dated (i.e., they show what was held six or more weeks earlier), they can nevertheless cue Wall Street and investors onto stocks or trends that have the attention of money managers. Edge cloud services provider Fastly (NYSE: FSLY) was a big-money favorite in Q4, with aggregate ownership among 13F filers increasing by 18% to 66.2 million shares from Q3 2020.
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Datadog Another tech stock with a bulls-eye on its proverbial back is application performance monitoring company Datadog (NASDAQ: DDOG). CrowdStrike Holdings Finally, billionaire money managers simply couldn't stay away from cybersecurity stock CrowdStrike Holdings (NASDAQ: CRWD). Despite aggregate ownership among 13F filers only increasing 6%, the total number of funds holding CrowdStrike at the end of the quarter rocketed 24% higher.
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Datadog Another tech stock with a bulls-eye on its proverbial back is application performance monitoring company Datadog (NASDAQ: DDOG). Snowflake Cloud data warehousing stock Snowflake (NYSE: SNOW) was also popular among billionaire investors during the fourth quarter. CrowdStrike Holdings Finally, billionaire money managers simply couldn't stay away from cybersecurity stock CrowdStrike Holdings (NASDAQ: CRWD).
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Datadog Another tech stock with a bulls-eye on its proverbial back is application performance monitoring company Datadog (NASDAQ: DDOG). In particular, billionaires couldn't stop buying the following five tech stocks during the fourth quarter. Snowflake Cloud data warehousing stock Snowflake (NYSE: SNOW) was also popular among billionaire investors during the fourth quarter.
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0d1d6454-45df-4705-b646-2aa1f07055fe
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718897.0
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2021-02-27 00:00:00 UTC
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3 Tech Stocks to Buy While They Are on Sale
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DDOG
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https://www.nasdaq.com/articles/3-tech-stocks-to-buy-while-they-are-on-sale-2021-02-27
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nan
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nan
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The tech sector has experienced huge gains since March of last year, as investors looked to technology companies that could thrive during a pandemic.
But lately, some tech stocks have taken a hit, and that's created a buying opportunity for investors. We asked three Motley Fool contributors for tech stocks that investors should snatch up while they're on sale and they came back with Roku (NASDAQ: ROKU), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL). Here's why.
Image source: Getty Images.
Throwing out the baby with the bathwater
Danny Vena (Roku): Sometimes, the market just sells off. It's an unavoidable part of being an investor. But if you can recognize this simple fact and take advantage of these inevitable declines, it will improve the overall performance of your portfolio -- especially if investors are selling both good stocks and bad alike.
That has certainly been the case lately with Roku. From its recent highs, the streaming pioneer is selling at nearly a 20% discount as of this writing. Investors looking for a reason for the declining stock price will likely come away empty-handed. Consider the company's recent results.
Roku reported fourth-quarter results that easily outpaced expectations. Active accounts grew 39% year over year, while the average revenue per user (ARPU) increased 24%. Not only that, but existing viewers are spending more time on the platform, as streaming hours jumped 55%. This all helped drive revenue up 58% year over year, resulting in a surprise profit, but even that doesn't tell the whole story.
The streaming company makes the majority of its money from its platform segment, which includes digital advertising, The Roku Channel, and the Roku Operating System (OS), which the company licenses to connected TV manufacturers. Revenue from the platform segment surged 81% higher, accelerating to its highest level of growth since the second quarter of 2019.
The Roku OS was the No. 1 smart TV operating system in the U.S., included in 38% of all smart TVs sold in the country. A similar story played out in Canada, where the Roku OS commanded a 31% market share. The company has only just begun its international expansion, entering markets in Brazil, the United Kingdom, and Mexico. Roku is employing the same strategy that was so successful in the United States: build scale, increase engagement, and monetize user activity.
There are other reasons to be optimistic. A customer testimonial in Roku's Q4 shareholder letter explained why advertisers are flocking to Roku (emphasis mine): "For every dollar we spent on Roku versus a large social media platform in July 2020, we had a 65% better return on investment with Roku, as their promotional capabilities attract the right customers in the right mindset to build long-lasting relationships."
The Roku Channel is another important growth driver. During the fourth quarter, viewership grew nearly twice as fast as its overall platform growth, up more than 100% year over year, and reaching nearly 20% of all U.S. households.
Finally, not many companies can go head-to-head with Amazon and emerge victorious, but count Roku among the few. The Roku platform boasts 51.2 million active accounts, outpacing Fire TV's base of 50 million. Even more telling, Roku's growth accelerated to 38% year over year, while Fire TV's slowed to 25%.
Given the wealth of catalysts, the robust results, and the consistently strong execution, investors should buy Roku shares while they're still on sale.
Image source: Getty Images.
A (Data)dog that watches your clouds
Brian Withers (Datadog): With the recent tech stock sell-off, cloud monitoring subscription service company Datadog has dropped, too. It's lost over 15% in the last several weeks to below $100 per share. Tech investors just might want to snatch up this gem while it's on sale. Let's look at three reasons why.
First, the company's growth has been jaw-dropping. For the last five quarters, it's posted 50%-plus year-over-year revenue gains.
METRIC
Q4 2019
Q1 2020
Q2 2020
Q3 2020
Q4 2020
Revenue
$114 million
$131 million
$140 million
$155 million
$178 million
Revenue growth (YOY)
85%
87%
68%
61%
56%
Revenue growth (QOQ)
19%
15%
7%
11%
15%
Data source: Datadog. YOY = year over year. QOQ = quarter over quarter
Even as the top-line growth slows as it gets bigger, the quarter-over-quarter gains have been in the double digits in four out of the last five quarters. This shows that the company has been able to post strong gains despite the pandemic as its products resonate with customers.
Second, the company's broad set of products are able to generate significant revenue per customer. With subscription offerings in infrastructure monitoring, log management, and security and network monitoring, customers can ensure their entire tech stack is operating properly. One customer, Peloton Interactive, depends on its real-time application performance monitoring tools to ensure its live fitness classes come off without a hitch. The number of customers using four or more products has doubled since last year from 10% to 22%, which may be part of the reason its $1 million annual revenue run rate customers have skyrocketed.
METRIC
Q4 2018
Q4 2019
Q4 2020
$1 million ARR customers
29
50
97
Growth (YOY)
142%
72%
94%
Data source: Datadog.
Finally, dependence on the cloud is in the early stages. The company estimated its addressable market as $35 billion when it filed its prospectus after it went public in September 2019. Its addressable market will expand as cloud influence grows and the company adds more capabilities, such as its recent acquisitions of Sqreen, a software-as-a-service (Saas)-based security platform, and Timber Technologies, a high-performance observability data pipeline. With $604 million in trailing-12-month revenue, it has a tiny 2% of the estimated market today.
Even though this cloud monitoring specialist is on sale, it's not cheap. With a price-to-sales ratio of 49, it is valued like premium SaaS players such as Shopify (P/S of 60) and C3 AI (P/S of 58). But for investors with a long-term mindset who buy a few shares today and add over time, this dog should provide years of loyal companionship and healthy returns.
Image source: Apple.
Apple's long-term potential is still intact
Chris Neiger (Apple): Apple's stock took a bit of a nosedive over the past month, falling 14% as of this writing. Why the drop? It looks like some investors didn't like Apple's first-quarter 2021 results, but I think they're missing the bigger picture. Here's why.
First, Apple is still squarely in growth mode. The company's revenue in the first quarter jumped 21% to $111 billion and earnings per share popped 35% to $1.68. That level of growth is hard to come by for many companies, let alone one with a market cap of $2 trillion.
Second, Apple is just getting started with its services business. This segment includes all of the company's newer services, like AppleTV+ and Apple Music, as well as other services like the App Store and AppleCare. In the most recent quarter, Apple's services revenue increased 24% to $15.8 billion. That's impressive growth, but Apple's services will likely continue expanding. Some estimates put Apple's full-year services revenue at $100 billion just three years from now.
Finally, Apple still has a lot more room to dominate the wearables market. The company leads this space with about 32% market share and it isn't slowing down. With a long list of devices, from the Apple Watch to AirPods and Beats headphones, Apple is seeing significant growth in wearables. Revenue jumped 30% year over year in the company's wearables, home, and accessories segment to nearly $13 billion and there's room for more growth. Research firm Gartner estimates global wearable device sales will spike from $46 billion in 2019 to $94 billion in 2022.
With Apple still firing on all cylinders and the company's share price down over the past month, this is a great time for investors to start a position with Apple or expand their existing one.
10 stocks we like better than Apple
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Apple wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of February 24, 2021
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Brian Withers owns shares of Amazon, Apple, Datadog, and Shopify. Chris Neiger owns shares of Apple. Danny Vena owns shares of Amazon, Apple, Datadog, Roku, and Shopify. The Motley Fool owns shares of and recommends Amazon, Apple, Datadog, Peloton Interactive, Roku, and Shopify. The Motley Fool recommends Gartner and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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We asked three Motley Fool contributors for tech stocks that investors should snatch up while they're on sale and they came back with Roku (NASDAQ: ROKU), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL). But if you can recognize this simple fact and take advantage of these inevitable declines, it will improve the overall performance of your portfolio -- especially if investors are selling both good stocks and bad alike. Its addressable market will expand as cloud influence grows and the company adds more capabilities, such as its recent acquisitions of Sqreen, a software-as-a-service (Saas)-based security platform, and Timber Technologies, a high-performance observability data pipeline.
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We asked three Motley Fool contributors for tech stocks that investors should snatch up while they're on sale and they came back with Roku (NASDAQ: ROKU), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL). A (Data)dog that watches your clouds Brian Withers (Datadog): With the recent tech stock sell-off, cloud monitoring subscription service company Datadog has dropped, too. Revenue $114 million $131 million $140 million $155 million $178 million Revenue growth (YOY) 85% 87% 68% 61% 56% Revenue growth (QOQ) 19% 15% 7% 11% 15% Data source: Datadog.
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We asked three Motley Fool contributors for tech stocks that investors should snatch up while they're on sale and they came back with Roku (NASDAQ: ROKU), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL). A customer testimonial in Roku's Q4 shareholder letter explained why advertisers are flocking to Roku (emphasis mine): "For every dollar we spent on Roku versus a large social media platform in July 2020, we had a 65% better return on investment with Roku, as their promotional capabilities attract the right customers in the right mindset to build long-lasting relationships." Revenue $114 million $131 million $140 million $155 million $178 million Revenue growth (YOY) 85% 87% 68% 61% 56% Revenue growth (QOQ) 19% 15% 7% 11% 15% Data source: Datadog.
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We asked three Motley Fool contributors for tech stocks that investors should snatch up while they're on sale and they came back with Roku (NASDAQ: ROKU), Datadog (NASDAQ: DDOG), and Apple (NASDAQ: AAPL). A (Data)dog that watches your clouds Brian Withers (Datadog): With the recent tech stock sell-off, cloud monitoring subscription service company Datadog has dropped, too. The number of customers using four or more products has doubled since last year from 10% to 22%, which may be part of the reason its $1 million annual revenue run rate customers have skyrocketed.
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f3523dae-5305-44c9-8a4a-6366f094eb85
|
718898.0
|
2021-02-22 00:00:00 UTC
|
Attention Reddit: Expiring PLTR Stock Lockups Provides a Second Buying Opportunity
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DDOG
|
https://www.nasdaq.com/articles/attention-reddit%3A-expiring-pltr-stock-lockups-provides-a-second-buying-opportunity-2021-02
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nan
|
nan
|
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Hello Reddit. I’m here to apologize. I know it was paper-handed of me to tell you folks to cut your GameStop (NYSE:GME) losses at $70 and AMC (NYSE:AMC) at $7.50. But I was only trying to help you degenerates avoid losing money on an unwinnable bet – today’s GME short-sellers are far better prepared to withstand another short squeeze. So, to make it up, I’d like to tell you about a far different company: Palantir (NYSE:PLTR).
PLTR) hangs on the New York Stock Exchange." width="300" height="169">
Source: rblfmr / Shutterstock.com
For some reason, Palantir one of the few companies you folks have fallen in love with that doesn’t classify as one of Warren Buffett’s “cigar butt” investments (BlackBerry (NYSE:BB) is the other that comes to mind). It’s a company that’s growing—and swiftly.
Unlike other r/WallStreetBets favorites, it’s now throwing off cash faster than it can spend it. As its salesforce continues to mature, you can expect this company to recover from its temporary dip.
PLTR Stock: A Quick History
In October, I wrote how insider selling of Palantir Technologies stock provides a golden buying opportunity. The first round of lockup expirations had driven the price of this secretive firm below $10. Those buying in would have been pleased. Since then, the company’s share price has ballooned. By January, the stock had reached a peak of almost $40. Call option buyers have walked away with small fortunes.
But then you degenerates forgot about Palantir. And quite frankly, so did I. On my part, Palantir’s price at $40 just started looking unexciting; its 53x price-to-sales ratio made it almost as expensive as DataDog (NASDAQ:DDOG), a super-charged cloud services company with even faster growth. And on your part, you were busy making money on GameStop while driving hedge funds out of business.
7 Media Stocks Ready for the Next Decade
Now that Palantir is back down to $25, it’s time to revisit our favorite CIA tech company.
How Did Palantir Stock Drop 35%?
The troubles all started in early February when the company released worse-than-expected results for 2020. Revenue from government contracts rocketed 85%, but commercial revenue grew only 4% – extremely low for a supposedly high-growth company. We all knew that 2020 would be rough for business selling to enterprise customers. We didn’t think it would be this bad.
And then Thursday, an even larger round of insider liquidation suddenly hit the market. As 80% of the company’s shares became free to trade, insiders sent the stock back down to $25 – even lower than its $25.83 Wall Street analyst target price.
Insider liquidations of this size are rare. But much of this came from Palantir’s own doing when its top brass eschewed the typical underwriting process for a direct listing. Rather than spend millions on having underwriters drip-feed shares into the market, the company essentially decided to dump shares onto the market themselves in two big waves.
What Now?
Reddit investors should sense an opportunity. It’s not often that insiders sell shares so quickly – and much of it is employees looking to diversify their holdings, not people just looking to cash out and run.
But here’s the rub: investing in PLTR stock still requires two things.
A degree of faith in its valuation. Palantir remains one of the most expensive tech firms in the world. Though its sticky business shows very low churn, PLTR stock still trades for a princely 54x EV-to-revenue multiple. That means Palantir will need to hit its lofty 30% growth targets to justify its price.
A willingness to invest despite moral issues. Palantir is no stranger to controversy. The company drew fire from the public for helping ICE deport undocumented immigrants, and even George Soros, an often-controversial figure, has offloaded his stake on moral grounds.
For a company that “knows everything about you,” it shouldn’t come as a surprise that not everyone will find their business palatable. But for those that do, then Palantir is a definite long-term winner.
Should You Buy PLTR Stock or Call Options?
Here’s where things get interesting. Though Palantir could eventually rebound to the $35 target price set by Goldman Sachs analyst Christopher Merwin, there’s no guarantee that this will happen before your call options expire. Many of Palantir’s staff are likely still holding onto their shares, waiting for a better opportunity to sell. That will make a short-term rebound to $45 far harder to achieve, no matter how much Reddit wants to oush. Instead, investors can expect Palantir to recover only slightly to $30 while insiders sell the stock they earned long ago. Put another way, stock is the way to play the short-term rebound.
However, if Palantir’s enterprise business regains steam later this year, its shares will start to rise quickly as insiders stop cashing out. The moment that happens, call options will suddenly become the right way to play this hot stock. Until then, you should stay patient. PLTR stock won’t stay in the $25-range forever, but its slow march to recovery will eventually get replaced by an even faster rebound if enterprise business roars once again.
On the date of publication, Tom Yeung did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Tom Yeung, CFA, is a registered investment advisor on a mission to bring simplicity to the world of investing.
The post Attention Reddit: Expiring PLTR Stock Lockups Provides a Second Buying Opportunity appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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On my part, Palantir’s price at $40 just started looking unexciting; its 53x price-to-sales ratio made it almost as expensive as DataDog (NASDAQ:DDOG), a super-charged cloud services company with even faster growth. width="300" height="169"> Source: rblfmr / Shutterstock.com For some reason, Palantir one of the few companies you folks have fallen in love with that doesn’t classify as one of Warren Buffett’s “cigar butt” investments (BlackBerry (NYSE:BB) is the other that comes to mind). The company drew fire from the public for helping ICE deport undocumented immigrants, and even George Soros, an often-controversial figure, has offloaded his stake on moral grounds.
|
On my part, Palantir’s price at $40 just started looking unexciting; its 53x price-to-sales ratio made it almost as expensive as DataDog (NASDAQ:DDOG), a super-charged cloud services company with even faster growth. And then Thursday, an even larger round of insider liquidation suddenly hit the market. Should You Buy PLTR Stock or Call Options?
|
On my part, Palantir’s price at $40 just started looking unexciting; its 53x price-to-sales ratio made it almost as expensive as DataDog (NASDAQ:DDOG), a super-charged cloud services company with even faster growth. PLTR Stock: A Quick History In October, I wrote how insider selling of Palantir Technologies stock provides a golden buying opportunity. 7 Media Stocks Ready for the Next Decade Now that Palantir is back down to $25, it’s time to revisit our favorite CIA tech company.
|
On my part, Palantir’s price at $40 just started looking unexciting; its 53x price-to-sales ratio made it almost as expensive as DataDog (NASDAQ:DDOG), a super-charged cloud services company with even faster growth. So, to make it up, I’d like to tell you about a far different company: Palantir (NYSE:PLTR). PLTR Stock: A Quick History In October, I wrote how insider selling of Palantir Technologies stock provides a golden buying opportunity.
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14128910-51fd-49a1-8b50-64ae93c8250f
|
718899.0
|
2021-02-22 00:00:00 UTC
|
Notable Monday Option Activity: DDOG, WBT, CZR
|
DDOG
|
https://www.nasdaq.com/articles/notable-monday-option-activity%3A-ddog-wbt-czr-2021-02-22
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nan
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nan
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Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 32,508 contracts has been traded thus far today, a contract volume which is representative of approximately 3.3 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 87.8% of DDOG's average daily trading volume over the past month, of 3.7 million shares. Particularly high volume was seen for the $85 strike put option expiring March 19, 2021, with 14,249 contracts trading so far today, representing approximately 1.4 million underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange:
Welbilt Inc (Symbol: WBT) options are showing a volume of 10,757 contracts thus far today. That number of contracts represents approximately 1.1 million underlying shares, working out to a sizeable 85.6% of WBT's average daily trading volume over the past month, of 1.3 million shares. Especially high volume was seen for the $25 strike call option expiring January 21, 2022, with 3,274 contracts trading so far today, representing approximately 327,400 underlying shares of WBT. Below is a chart showing WBT's trailing twelve month trading history, with the $25 strike highlighted in orange:
And Caesars Entertainment Inc (Symbol: CZR) saw options trading volume of 15,961 contracts, representing approximately 1.6 million underlying shares or approximately 81.4% of CZR's average daily trading volume over the past month, of 2.0 million shares. Particularly high volume was seen for the $85 strike call option expiring March 19, 2021, with 1,874 contracts trading so far today, representing approximately 187,400 underlying shares of CZR. Below is a chart showing CZR's trailing twelve month trading history, with the $85 strike highlighted in orange:
For the various different available expirations for DDOG options, WBT options, or CZR options, visit StockOptionsChannel.com.
Today's Most Active Call & Put Options of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Particularly high volume was seen for the $85 strike put option expiring March 19, 2021, with 14,249 contracts trading so far today, representing approximately 1.4 million underlying shares of DDOG. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 32,508 contracts has been traded thus far today, a contract volume which is representative of approximately 3.3 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 87.8% of DDOG's average daily trading volume over the past month, of 3.7 million shares.
|
Particularly high volume was seen for the $85 strike put option expiring March 19, 2021, with 14,249 contracts trading so far today, representing approximately 1.4 million underlying shares of DDOG. Below is a chart showing DDOG's trailing twelve month trading history, with the $85 strike highlighted in orange: Welbilt Inc (Symbol: WBT) options are showing a volume of 10,757 contracts thus far today. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 32,508 contracts has been traded thus far today, a contract volume which is representative of approximately 3.3 million underlying shares (given that every 1 contract represents 100 underlying shares).
|
Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 32,508 contracts has been traded thus far today, a contract volume which is representative of approximately 3.3 million underlying shares (given that every 1 contract represents 100 underlying shares). Particularly high volume was seen for the $85 strike put option expiring March 19, 2021, with 14,249 contracts trading so far today, representing approximately 1.4 million underlying shares of DDOG. That number works out to 87.8% of DDOG's average daily trading volume over the past month, of 3.7 million shares.
|
Particularly high volume was seen for the $85 strike put option expiring March 19, 2021, with 14,249 contracts trading so far today, representing approximately 1.4 million underlying shares of DDOG. Below is a chart showing CZR's trailing twelve month trading history, with the $85 strike highlighted in orange: For the various different available expirations for DDOG options, WBT options, or CZR options, visit StockOptionsChannel.com. Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Datadog Inc (Symbol: DDOG), where a total volume of 32,508 contracts has been traded thus far today, a contract volume which is representative of approximately 3.3 million underlying shares (given that every 1 contract represents 100 underlying shares).
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ed1f607e-a045-40d2-970e-ec8c7b0dfc48
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