10 Best SaaS Stocks To Buy Now

6. Datadog, Inc. (NASDAQ:DDOG)

Number of Hedge Fund Investors In Q1 2024: 77

YTD Return: -2.9%

Datadog, Inc. (NASDAQ:DDOG) is a diversified enterprise SaaS company that enables customers to monitor their systems performance, threat logs, and other aspects. The firm’s shares slipped by 11% in May after its latest earnings report presented a mixed bag of results. It saw Datadog, Inc. (NASDAQ:DDOG) beat analyst EPS estimates of $0.34 by posting $0.44 and revenue estimates of $590 million by posting $611 million. However, investors were disappointed as billings of $618 million missed estimates of $623 million and it announced a leadership transition in the form of a new president. Goldman Sachs kept a $143 share price target and a Buy rating in June 2024, after it was impressed by CEO Olivier Pomel’s belief that Datadog, Inc. (NASDAQ:DDOG) stands to benefit from AI due to increasing IT complexity which can drive a 20% long term growth rate.

The average of 34 one year analyst share price targets for Datadog, Inc. (NASDAQ:DDOG) is $147.34. This marks an upside of 25% over the recent closing price of $117.84. The three year annualized revenue growth rate is 52.22%. Baron Funds mentioned Datadog, Inc. (NASDAQ:DDOG) in its Q4 2023 investor letter where it shared:

Many of our companies have been reporting on customer consolidation trends and rising win rates against competitors. In its their most recent quarterly conference call, Datadog described a customer who replaced seven different tool providers with the Datadog platform and another one who replaced a dozen different tools and moved to Datadog.