5 Best Big Data Stocks to Buy Now

4. Datadog, Inc. (NASDAQ:DDOG)

Number of Hedge Fund Holders: 81

Datadog, Inc. (NASDAQ:DDOG) is a leading global cloud computing company that provides monitoring, analytics, and observability services for developers, information technology operations teams, and business users. Insider Monkey found 81 hedge funds bullish on Datadog, Inc. (NASDAQ:DDOG) at the close of Q2 2022. The funds held collective stakes of $2.71 billion in the company.

On August 4, Datadog, Inc. (NASDAQ:DDOG) announced that it has acquired Datadog announced it has acquired Seekret, an emerging software developer that develops API observability applications. The company noted that with this acquisition it plans to extend its platform to deliver more insightful API observability, governance, and automation for businesses.

Wall Street is bullish on Datadog, Inc. (NASDAQ:DDOG). On September 20, Baird analyst William Power started coverage of Datadog, Inc. (NASDAQ:DDOG) with a buy-side Outperform rating and a $120 price target. The analyst noted that the company has established itself as an industry leader in the cloud space and he sees upside to the stock due to the company’s “leading growth and strong cash flow”. As of September 28, Datadog, Inc. (NASDAQ:DDOG) has free cash flows of $353.8 million.

As of June 30, Durable Capital Partners owns over 3.1 million shares of Datadog, Inc. (NASDAQ:DDOG) and is the most prominent investor in the company. The fund’s stakes are valued at $299.4 million.

Here is what Baron Funds had to say about Datadog, Inc. (NASDAQ:DDOG) in its first-quarter 2022 investor letter:

“Another example is Datadog, the leading infrastructure monitoring, application performance monitoring and log management software platform. Datadog’s stock declined 15% during the quarter, despite reporting sparkling operational results, with revenues accelerating to a growth rate of 84% year-over-year with 33% free cash flow margins, while guiding for 2022 significantly above expectations. Datadog added 4,600 new customers in the quarter, while existing customers continued to increase their spending on Datadog products at a rapid pace with the number of customers using four or more products increasing to 33% from 22% last year. While Datadog’s stock was down, its intrinsic value has undoubtedly increased. This is enabled by rapid innovation (Datadog released 13 new products in 2021) into a market that is benefiting from the secular growth in cloud, digital transformation, and the explosion in complexity as the number of vendors, diversity of technologies and related infrastructure continued to expand.”