One of the directors at Datadog (NASDAQ:DDOG) engaged in a huge insider buy transaction yesterday. Matthew Jacobson bought 719,894 shares of Datadog stock at an average price of $69.45 per share, worth $50 million. DDOG stock has started rising in pre-market trading, and by many measures, it appears to be a good buy.
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Datadog is an SaaS-based data monitoring and analytics platform. With the recent Buys, the director now owns 4.45% (13 million shares) of the total DDOG shares outstanding, with a value of $916.16 million.
Interestingly, TipRanks also provides a list of hot stocks that boast either a Very Positive or Positive insider confidence signal.
Jacobson is likely encouraged by DDOG’s recent earnings. Last week, Datadog reported stronger-than-expected Q3 results, beating consensus estimates, and also raised its guidance for the full year FY2022.
Based on robust Q3 results, management raised its guidance range for the full year 2022. For FY22, total revenue is now expected to range between $1.65 – $1.654 billion, higher than the prior outlook of $1.61 – $1.63 billion. Adjusted EPS is expected to range between $0.90-$0.92, higher than the previously guided range of $0.74-$0.87.
Is DDOG a Buy or Sell?
The Wall Street community is clearly optimistic about the stock. Overall, the stock commands a Strong Buy consensus rating based on 20 Buys and six Holds. Datadog’s average price target of $110.74 implies 64.74% upside potential from current levels.
Further, DDOG stock boasts a score of 9 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
Concluding Thoughts
Though Datadog stock is down 65% over the past year, it is still trading at premium valuations compared to its peer group.
Nonetheless, given its strong fundamentals and robust growth potential, it’s not just the corporate Insiders that are bullish on the stock. DDOG stock also has a very positive signal from hedge fund managers, who added 4.6 million shares during the last quarter.
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