DA Davidson reiterated a Buy rating on Datadog (NASDAQ:DDOG) and maintained a $225.00 price target after participating in the company's investor day in New York City. The brokerage flagged the presentation as clarifying Datadog's positioning in the emerging autonomous observability market and left Datadog on its list of top picks for the year.
At the event, Datadog management walked through the company's platform direction and its approach to autonomous observability. The presentation included specifics on the AI product roadmap and identified growth opportunities linked to agentic use cases. Executives also disclosed annual recurring revenue figures tied to Security customers and to AI use cases, and reiterated the firm's financial targets during the session.
Market metrics cited alongside the investor-day coverage underscore the company's financial profile. Datadog shares were trading at $121.04, reflecting a price-to-earnings ratio of 396.19 at the time of the report. Separately, InvestingPro analysis highlighted Datadog's strong unit economics, showing gross profit margins approaching 80%.
DA Davidson said the investor day provided increased clarity on how Datadog intends to compete within autonomous observability, and reaffirmed the firm’s Buy view given that perspective. The broker's $225.00 price target implies material upside from the then-current share price.
Other brokerages and research houses have recently revisited Datadog's outlook, producing a range of reactions:
- Canaccord Genuity pointed to Datadog's accelerating top-line momentum, noting a 29% year-over-year revenue gain in the most recent quarter and a 28% increase for the full year. Canaccord also highlighted that Datadog's three core segments - Infrastructure, Application Performance Monitoring (APM), and Logs - each exceeded $1 billion in annual recurring revenue.
- Scotiabank commented favorably on Datadog's 2026 revenue guidance but trimmed its price target from $180 to $160, citing valuation concerns.
- BMO Capital lowered its price target to $165 from $170 while keeping an Outperform rating, noting possible competitive risks within the AI landscape. BMO also attended Datadog's investor day and observed that fiscal 2026 revenue guidance came in below consensus estimates but above buy-side expectations.
- Citizens' analysts reiterated a Market Perform rating, but said they were impressed by continued growth across Datadog's observability pillars.
- Canaccord Genuity later adjusted its price target to $185 from $210 while maintaining a Buy rating, describing its stance as driven by a prudent view on growth.
Taken together, these analyst moves show a combination of cautious optimism about Datadog's growth trajectory and adjustments to valuation assumptions or near-term expectations. Several firms recognized durable demand across core observability products and emerging AI-related use cases, while others signaled concern over price levels or heightened competition in AI.
Investors evaluating Datadog will need to weigh the company’s strong gross margins and reported ARR milestones against a lofty valuation multiple and the industry dynamics around AI competition and guidance that sits below some consensus forecasts. DA Davidson’s reaffirmation and high price target underscore one prominent bullish view, while recent target cuts and mixed ratings from other firms reflect the market’s range of perspectives.