DataDog Q3 FY12/24 Earnings Review

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Ageing Gracefully

By Alex King, CEO, Cestrian Capital Research, Inc.

The days of DataDog ($DDOG) growing at 50% and better are long gone, but the business has matured nicely into a solid enterprise software business with a forward order book worth around three-quarters of its trailing twelve month revenue, unlevered pretax free cashflow margins in the low 20s, and solid revenue growth rates also in the low to mid 20s.

Investors in DDOG can feel good that the company itself is solid, therefore. But the stock price ebbs and flows fairly wildly with market sentiment; so it's not enough to study the fundamentals alone - fundamentals won't tell you when is a solid buying opportunity and they won't tell you when it might be a good idea to reduce risk and reduce exposure (or sell altogether).

Let's take a look at the Q3 report and Q4 guide, together with our chart analysis, valuation analysis, and stock rating.

Financial Summary

Here's the headlines.

Now, for our paying subscribers of all tiers here, we go on to look at financial fundamentals, valuation analysis, our rating and price targets.