Datadog (NASDAQ:DDOG) Shares Gap Down – What’s Next?

Datadog, Inc. (NASDAQ:DDOG)’s share price gapped down before the market opened on Wednesday . The stock had previously closed at $122.56, but opened at $116.99. Datadog shares last traded at $121.29, with a volume of 3,619,422 shares traded.

Key Stories Impacting Datadog

Here are the key news stories impacting Datadog this week:

• Positive Sentiment: DA Davidson reiterated a Buy on DDOG and set a $225 price target, implying significant upside versus current levels; that reaffirmation supports a constructive medium-term thesis. DA Davidson Reaffirmation
• Positive Sentiment: The Motley Fool included Datadog among AI/tech names some Wall Street analysts view as undervalued, signaling potential analyst-driven buy interest if sentiment shifts back to growth names. 2 Undervalued AI Stocks
• Positive Sentiment: Case study: QSIC announced it uses Datadog to improve retail media reliability — evidence of customer traction in advertising/retail monitoring use cases. QSIC Case Study
• Neutral Sentiment: Datadog’s Analyst/Investor Day transcript is available for review; it may contain execution details and long-term model clarity that investors will parse for conviction. Investor Day Transcript
• Neutral Sentiment: A Globe & Mail piece highlights conflicted analyst views on Datadog and other tech names — underscores dispersion in expectations rather than consensus. Analysts Conflicted
• Neutral Sentiment: Recent short-interest reports appear to show inconsistent/zero data (likely a reporting artifact); no clear signal from short activity at this time.
• Negative Sentiment: Cantor Fitzgerald cut its price target on DDOG to $150 from $220 (keeps Overweight), trimming upside expectations and contributing to near-term selling pressure. Cantor Fitzgerald PT Cut
• Negative Sentiment: Broader sector weakness: CNBC reports Palo Alto’s CEO defending cybersecurity amid AI-driven selloff in software stocks — highlights macro/AI rotation risk that can weigh on Datadog despite company-specific strengths. Palo Alto/AI Sector Pressure

Wall Street Analyst Weigh In

Several research firms have weighed in on DDOG. Moffett Nathanson reaffirmed a “buy” rating on shares of Datadog in a research note on Monday, December 29th. UBS Group set a $195.00 target price on Datadog in a research note on Monday, February 9th. KeyCorp dropped their price target on Datadog from $170.00 to $155.00 and set an “overweight” rating on the stock in a research note on Wednesday, February 4th. Cantor Fitzgerald lowered their target price on Datadog from $220.00 to $150.00 and set an “overweight” rating on the stock in a research report on Friday, February 6th. Finally, Wedbush dropped their target price on Datadog from $215.00 to $190.00 and set an “outperform” rating on the stock in a report on Wednesday, February 11th. Thirty-six analysts have rated the stock with a Buy rating, four have issued a Hold rating and two have assigned a Sell rating to the company’s stock. According to MarketBeat, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $179.62.

Datadog Stock Performance

The business’s fifty day moving average price is $131.05 and its 200-day moving average price is $143.36. The company has a debt-to-equity ratio of 0.26, a current ratio of 3.38 and a quick ratio of 3.66. The stock has a market capitalization of $42.51 billion, a PE ratio of 391.01, a P/E/G ratio of 34.26 and a beta of 1.27.

Datadog (NASDAQ:DDOG) last posted its quarterly earnings data on Tuesday, February 10th. The company reported $0.59 earnings per share for the quarter, beating the consensus estimate of $0.55 by $0.04. The firm had revenue of $953.19 million for the quarter, compared to analysts’ expectations of $916.53 million. Datadog had a net margin of 3.14% and a return on equity of 4.14%. The business’s quarterly revenue was up 29.2% on a year-over-year basis. During the same quarter last year, the company posted $0.49 EPS. Datadog has set its FY 2026 guidance at 2.080-2.160 EPS and its Q1 2026 guidance at 0.490-0.510 EPS. As a group, equities research analysts expect that Datadog, Inc. will post 0.34 EPS for the current year.

Insider Buying and Selling

In other Datadog news, CEO Olivier Pomel sold 32,923 shares of the company’s stock in a transaction that occurred on Wednesday, December 3rd. The stock was sold at an average price of $154.63, for a total transaction of $5,090,883.49. Following the completion of the transaction, the chief executive officer owned 518,133 shares of the company’s stock, valued at $80,118,905.79. This represents a 5.97% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at the SEC website. Also, CTO Alexis Le-Quoc sold 53,912 shares of Datadog stock in a transaction that occurred on Monday, December 8th. The stock was sold at an average price of $154.05, for a total value of $8,305,143.60. Following the completion of the sale, the chief technology officer owned 295,448 shares in the company, valued at approximately $45,513,764.40. This represents a 15.43% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 380,515 shares of company stock valued at $55,760,478 over the last three months. 8.70% of the stock is owned by company insiders.

Hedge Funds Weigh In On Datadog

A number of institutional investors have recently added to or reduced their stakes in DDOG. Rothschild Investment LLC increased its stake in shares of Datadog by 126.6% in the 3rd quarter. Rothschild Investment LLC now owns 179 shares of the company’s stock worth $25,000 after acquiring an additional 100 shares in the last quarter. Physician Wealth Advisors Inc. increased its holdings in shares of Datadog by 315.2% during the third quarter. Physician Wealth Advisors Inc. now owns 191 shares of the company’s stock valued at $27,000 after acquiring an additional 145 shares in the last quarter. Westside Investment Management Inc. raised its position in shares of Datadog by 74.3% in the 3rd quarter. Westside Investment Management Inc. now owns 176 shares of the company’s stock worth $27,000 after purchasing an additional 75 shares during the last quarter. JPL Wealth Management LLC bought a new position in Datadog in the 3rd quarter worth about $27,000. Finally, Tripletail Wealth Management LLC bought a new position in Datadog in the 3rd quarter worth about $28,000. Institutional investors own 78.29% of the company’s stock.

Datadog Company Profile

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

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