Here’s Why Artisan Partners Trimmed its Datadog (DDOG) Stake

Artisan Partners, a high value-added investment management firm, published its ‘Artisan Mid Cap Fund’ fourth quarter 2021 investor letter – a copy of which can be downloaded here. A return of -0.72% was recorded by its Investor Class: ARTMX, -0.68% by its Advisor Class: APDMX, and -0.66% by its Institutional Class: APHMX, in the fourth quarter of 2021, all underperforming the Russell Midcap® Growth Index that delivered a 2.85% return, and the Russell Midcap® Index that was up by 6.44% for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Artisan Mid Cap Fund, in its Q4 2021 investor letter, mentioned Datadog, Inc. (NASDAQ: DDOG) and discussed its stance on the firm. Datadog, Inc. is a New York, New York-based cybersecurity company with a $49.6 billion market capitalization. DDOG delivered a -10.72% return since the beginning of the year, while its 12-month returns are up by 51.38%. The stock closed at $159.02 per share on February 22, 2022.

Here is what Artisan Mid Cap Fund has to say about Datadog, Inc. in its Q4 2021 investor letter:

“Datadog is a leading provider of monitoring and analytics for cloudbased applications. Software has become central to how organizations deliver differentiated products and user experiences and optimize business processes—fueling the disruption taking place across nearly every industry. The success of this digital transformation trend is increasingly tied to quality and performance—in turn, driving strong secular demand for IT infrastructure and application monitoring platforms like Datadog’s. The company’s profit cycle was on clear display in its Q3 results, with 75% top line growth driven by new customer additions and existing customers adding additional services. Free cash flow margins expanded nicely as well. We believe Datadog’s low-touch, land-and-expand customer acquisition model combined with a steadily expanding product portfolio position it well for strong profit growth in the coming years, though we trimmed our position size during the quarter as shares approached our PMV estimate.”

Photo by Danial Igdery on Unsplash

Our calculations show that Datadog, Inc. (NASDAQ: DDOG) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. DDOG was in 73 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 62 funds in the previous quarter. Datadog, Inc. (NASDAQ: DDOG) delivered a -17.44% return in the past 3 months.

In January 2022, we also shared another hedge fund’s views on DDOG in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.