DATADOG INC - CLASS A (DDOG) Stock Fundamental Analysis
NASDAQ:DDOG - Nasdaq - US23804L1035 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to DDOG. DDOG was compared to 281 industry peers in the Software industry. DDOG has an excellent financial health rating, but there are some minor concerns on its profitability. DDOG is valued quite expensively, but it does show have an excellent growth rating. These ratings would make DDOG suitable for growth investing!
1. Profitability
1.1 Basic Checks
DDOG had positive earnings in the past year.
DDOG had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: DDOG reported negative net income in multiple years.
In the past 5 years DDOG always reported a positive cash flow from operatings.
1.2 Ratios
DDOG's Return On Assets of 3.18% is fine compared to the rest of the industry. DDOG outperforms 70.82% of its industry peers.
The Return On Equity of DDOG (6.77%) is better than 72.24% of its industry peers.
DDOG's Return On Invested Capital of 1.18% is fine compared to the rest of the industry. DDOG outperforms 67.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.18% | ||
| ROE | 6.77% | ||
| ROIC | 1.18% |
ROA(3y)0.91%
ROA(5y)0.11%
ROE(3y)1.87%
ROE(5y)0.21%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
DDOG has a better Profit Margin (6.85%) than 71.89% of its industry peers.
DDOG has a Operating Margin of 2.02%. This is in the better half of the industry: DDOG outperforms 67.26% of its industry peers.
DDOG has a Gross Margin of 80.79%. This is amongst the best in the industry. DDOG outperforms 83.99% of its industry peers.
In the last couple of years the Gross Margin of DDOG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.02% | ||
| PM (TTM) | 6.85% | ||
| GM | 80.79% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.52%
GM growth 5Y1.37%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DDOG is destroying value.
Compared to 1 year ago, DDOG has more shares outstanding
DDOG has more shares outstanding than it did 5 years ago.
The debt/assets ratio for DDOG is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 8.22 indicates that DDOG is not in any danger for bankruptcy at the moment.
DDOG has a Altman-Z score of 8.22. This is amongst the best in the industry. DDOG outperforms 83.27% of its industry peers.
The Debt to FCF ratio of DDOG is 2.08, which is a good value as it means it would take DDOG, 2.08 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.08, DDOG is doing good in the industry, outperforming 67.26% of the companies in the same industry.
A Debt/Equity ratio of 0.36 indicates that DDOG is not too dependend on debt financing.
DDOG has a Debt to Equity ratio of 0.36. This is in the lower half of the industry: DDOG underperforms 61.21% of its industry peers.
Although DDOG does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 2.08 | ||
| Altman-Z | 8.22 |
ROIC/WACC0.11
WACC10.56%
2.3 Liquidity
DDOG has a Current Ratio of 2.64. This indicates that DDOG is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of DDOG (2.64) is better than 70.11% of its industry peers.
DDOG has a Quick Ratio of 2.64. This indicates that DDOG is financially healthy and has no problem in meeting its short term obligations.
DDOG's Quick ratio of 2.64 is fine compared to the rest of the industry. DDOG outperforms 70.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.64 | ||
| Quick Ratio | 2.64 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.98% over the past year.
The Earnings Per Share has been growing by 54.87% on average over the past years. This is a very strong growth
The Revenue has grown by 26.12% in the past year. This is a very strong growth!
DDOG shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 49.22% yearly.
EPS 1Y (TTM)10.98%
EPS 3Y54.87%
EPS 5YN/A
EPS Q2Q%-10.91%
Revenue 1Y (TTM)26.12%
Revenue growth 3Y37.67%
Revenue growth 5Y49.22%
Sales Q2Q%25.11%
3.2 Future
Based on estimates for the next years, DDOG will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.43% on average per year.
Based on estimates for the next years, DDOG will show a very strong growth in Revenue. The Revenue will grow by 20.11% on average per year.
EPS Next Y-1.76%
EPS Next 2Y9.72%
EPS Next 3Y14.77%
EPS Next 5Y19.43%
Revenue Next Year20.27%
Revenue Next 2Y19.94%
Revenue Next 3Y20.65%
Revenue Next 5Y20.11%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 57.69, the valuation of DDOG can be described as expensive.
DDOG's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of DDOG to the average of the S&P500 Index (28.22), we can say DDOG is valued expensively.
The Price/Forward Earnings ratio is 58.73, which means the current valuation is very expensive for DDOG.
DDOG's Price/Forward Earnings ratio is in line with the industry average.
DDOG's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 20.86.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.69 | ||
| Fwd PE | 58.73 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DDOG is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DDOG is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 46.78 | ||
| EV/EBITDA | 281.47 |
4.3 Compensation for Growth
A more expensive valuation may be justified as DDOG's earnings are expected to grow with 14.77% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y9.72%
EPS Next 3Y14.77%
5. Dividend
5.1 Amount
DDOG does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
105
-1.32 (-1.24%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners88.58%
Inst Owner Change0.45%
Ins Owners2.83%
Ins Owner Change13.99%
Market Cap36.26B
Analysts80.82
Price Target146.92 (39.92%)
Short Float %3.29%
Short Ratio1.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.5%
Min EPS beat(2)10.09%
Max EPS beat(2)12.91%
EPS beat(4)4
Avg EPS beat(4)15.36%
Min EPS beat(4)10.09%
Max EPS beat(4)23.78%
EPS beat(8)8
Avg EPS beat(8)19.38%
EPS beat(12)12
Avg EPS beat(12)31.64%
EPS beat(16)16
Avg EPS beat(16)52.64%
Revenue beat(2)2
Avg Revenue beat(2)1.53%
Min Revenue beat(2)1.22%
Max Revenue beat(2)1.83%
Revenue beat(4)4
Avg Revenue beat(4)1.42%
Min Revenue beat(4)1.22%
Max Revenue beat(4)1.83%
Revenue beat(8)7
Avg Revenue beat(8)1.3%
Revenue beat(12)11
Avg Revenue beat(12)2.17%
Revenue beat(16)15
Avg Revenue beat(16)3.45%
PT rev (1m)-9.54%
PT rev (3m)-10.78%
EPS NQ rev (1m)-0.15%
EPS NQ rev (3m)-6.64%
EPS NY rev (1m)-0.23%
EPS NY rev (3m)-14.45%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)0.17%
Revenue NY rev (1m)-0.12%
Revenue NY rev (3m)-1.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.69 | ||
| Fwd PE | 58.73 | ||
| P/S | 13.51 | ||
| P/FCF | 46.78 | ||
| P/OCF | 41.65 | ||
| P/B | 13.36 | ||
| P/tB | 15.43 | ||
| EV/EBITDA | 281.47 |
EPS(TTM)1.82
EY1.73%
EPS(NY)1.79
Fwd EY1.7%
FCF(TTM)2.24
FCFY2.14%
OCF(TTM)2.52
OCFY2.4%
SpS7.77
BVpS7.86
TBVpS6.81
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.18% | ||
| ROE | 6.77% | ||
| ROCE | 1.38% | ||
| ROIC | 1.18% | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | 2.02% | ||
| PM (TTM) | 6.85% | ||
| GM | 80.79% | ||
| FCFM | 28.88% |
ROA(3y)0.91%
ROA(5y)0.11%
ROE(3y)1.87%
ROE(5y)0.21%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.52%
GM growth 5Y1.37%
F-Score6
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.36 | ||
| Debt/FCF | 2.08 | ||
| Debt/EBITDA | 8.97 | ||
| Cap/Depr | 173.85% | ||
| Cap/Sales | 3.56% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 797.13% | ||
| Profit Quality | 421.83% | ||
| Current Ratio | 2.64 | ||
| Quick Ratio | 2.64 | ||
| Altman-Z | 8.22 |
F-Score6
WACC10.56%
ROIC/WACC0.11
Cap/Depr(3y)167.26%
Cap/Depr(5y)165.21%
Cap/Sales(3y)3.45%
Cap/Sales(5y)3.63%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)10.98%
EPS 3Y54.87%
EPS 5YN/A
EPS Q2Q%-10.91%
EPS Next Y-1.76%
EPS Next 2Y9.72%
EPS Next 3Y14.77%
EPS Next 5Y19.43%
Revenue 1Y (TTM)26.12%
Revenue growth 3Y37.67%
Revenue growth 5Y49.22%
Sales Q2Q%25.11%
Revenue Next Year20.27%
Revenue Next 2Y19.94%
Revenue Next 3Y20.65%
Revenue Next 5Y20.11%
EBIT growth 1Y262.25%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year18.05%
EBIT Next 3Y24.09%
EBIT Next 5Y22.11%
FCF growth 1Y29.71%
FCF growth 3Y45.72%
FCF growth 5Y295.6%
OCF growth 1Y31.92%
OCF growth 3Y44.84%
OCF growth 5Y104.74%