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Could Datadog Be an Even Better Bet than Cloud Leaders?

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Oracle News

It’s no secret that “working-from-home”-related stocks have has surged during the pandemic. But the “stay-at-home” tech stock has a bright outlook even after the pandemic has been won. Overall, COVID-19 only accelerated existing technology trends such as e-commerce, remote working and learning, as well as tele-medicine. More than ever, enterprises are forced to digitize their organizations as quickly as possible. And this involves reaching out to customers who are now spending most of their time indoors. Among the leading companies that can help businesses accomplish this transition is Datadog (NASDAQ:DDOG). It is a cloud infrastructure monitoring service that provides monitoring of servers, databases, tools, and services through a Saas- based data analytics platform.

A relatively young company but in line with industry leaders

As cloud adoption increased, Datadog grew rapidly and expanded its product offering to cover service providers including Amazon Web Services (NASDAQ:AMZN), Microsoft Azure (NASDAQ:MSFT) and Alphabet’s Google Cloud Platform (NASDAQ:GOOG). This is why we dare we compare this newbie to such big tech such as Google? Not only can these stocks compare but it is debatable which one is the best buy.

Google even managed to beat the ad slump

If there is something you need answered, you go to Alphabet’s Google search engine. And don’t forget that it also acquired YouTube’s online video service which you also most likely use. With many stuck at home, usage of these two skyrocketed in the first quarter, leaving even the Super Bowl behind. YouTube premium subscriptions increased during the quarter with the lack of live sports and people cutting the cord on traditional cable. Even with the COVID-19 pandemic hitting the U.S. hard during the final two weeks of the quarter, YouTube was a notable outperformer when it comes to advertising.

Strong COVID quarter

YouTube exited March with revenue up 9% year-over-year. This growth was caused by an increase in demand response advertising. This is even more impressive if we consider that search advertising went down mid-teens and Google’s network partner advertising down low double digits. Even other non-core Alphabet products and services saw a pickup in demand in Q1. Chromebook sales spiked 400% over the prior year in the week ending March 21. Obviously, it was also a strong quarter for Google’s Meet video conferencing service, which saw a tremendous increase in usage as it competes directly with Zoom Video Communications Inc (NASDAQ:ZM) which also saw a skyrocketing demand. Overall, as businesses start to reopen and look to attract and notify their customers that they are coming back to life, Google’s properties are a true gold mine to advertise on.

And let’s not forget the cloud – an investment that is paying off

Alphabet has done a great job of growing its Google Cloud Platform into a formidable number three player in the cloud infrastructure sector. Realizing the importance of cloud, Google has invested heavily over the past few years to catch up to the cloud leaders along with hiring ex-Oracle (NYSE:ORCL) executive Thomas Kurian in 2018.

Its strategy is paying off even faster due to COVID-19. The company’s cloud segment surged 52% in the first quarter. According to a recent report from research firm Canalys, Google Cloud grew its infrastructure service by 87.8% in 2019, increasing its market share from 4.2% to 5.8%. So along with Microsoft and Amazon, you would think these are the only three players that count in the cloud game. But there is also Datadog.

Datadog’s powerful combination

Unlike Alphabet which has been public for 16 years, 2004, Datagod had its IPO in September last year. But Datadog is keeping tabs on all your tech. While there are many other competitors that offer infrastructure monitoring, cloud monitoring, application monitoring, or log management, Datadog incorporates all of these in an easy-to-use interface at a very powerful platform of its own. And 11,500 customers over the course of 10 years are in love with it. Moreover, even after a decade of its existence, the company is still growing at an impressive pace. Last quarter, revenue surged 87% and management also raised full-year guidance on the recent surprising strength.  Datadog also now has over 400 different third-party integrations, making it a very important unifying platform for any organization. So, it is certainly a company that is worth mentioning.

Differences

While both help corporations digitize their infrastructures, they are very different in terms of business models and overall characteristics.

Alphabet – the diversified giant

To start off, Alphabet has a market cap of nearly $1 trillion. It is highly diversified in core digital advertising, cloud computing, hardware and app store. Also, we must not forget its ‘other bets’ segment with moonshot projects. Alphabet is also highly profitable, with operating margins of 22% over the past 12 months – even while ad revenue was affected by the pandemic.

Datadog – less diversified but with impressive results

Meanwhile, Datadog is more of a one-product platform, making it less diversified, and much more risky. But, Datadog showed a slight operating profit in its recent quarter. It is more than common for such high-growth software-as-a-service companies to post operating losses as a cost of growth. Impressively, Datadog expanded its gross margins from 73% to 80% over the past year.

Datadog is a fine candidate

Datagod’s performance indicates that strong profits could be in the near future as the company continues to scale. The only downside is that grow so fast often trade at seemingly high valuations, yet Datadog can still be winning stocks over the long-term. Thus, for those willing to overcome volatility for higher growth potential, Datadog would make a fine candidate. For better of worse, social distancing is here to stay, at least until COVID-19 vaccine sees the light of the day. These trends will only further accelerate its growth.

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

BenzingaEditorial

This Week’s Recap

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The market and the economy continue to open, which is probably a result of bottled-up demand for many products and services affected by the pandemic. Maybe the inflation or rising bond yields will trigger the selloff on the market at some moment, but the current Fed’s transitory inflation message has been accepted by many investors. Also, the best way to deal with inflation is to stay with your investments and keep your faith in the market. So, despite the jump of May’s consumer-price index, that did not affect the investors who adopted a different mindset, so all three major averages finished in a positive zone.

The Dow Jones Industrial Average managed to recover from one of the steeper declines, thanks to gains from companies like IBM (NYSE: IBM), Microsoft (NASDAQ: MSFT), and Salesforce (NYSE: CRM). The Nasdaq Composite Index has also risen 49.09 points to 14,069.42. The tech-heavy index continued with the positive run, led by DocuSign (NASDAQ: DOCU), Zoom Video (NASDAQ: ZM), and CrowdStrike (NASDAQ: CRWD).

Tuesday brought us an earnings report from Oracle

Although it was a slim week for the earnings reports, Oracle (NYSE: ORCL) announced its last quarter results, as well as plans and guidance. The results are better than expected, as the achieved revenues were $11.23 billion (compared to the expected $11.04 billion) and the achieved adjusted earnings of $1.54 per share (compared to the expected $1.31). On the other hand, the company revealed its quarterly revenue guidance, which is lower than expected due to the plans to increase investments to support its cloud strategy and keep migrating existing on-premises customers to the cloud. This all led to a share fall of 5%, as many investors are skeptical if Oracle can successfully compete with major “cloud” players like Amazon (NASDAQ: AMZN), Salesforce, or Workday (NASDAQ: WDAY).

Adobe reported impressive results on Thursday

The Wall Street analysts recognized the work-from-home trend and this second digitization era as the main reasons for Adobe’s (NASDAQ: ADBE) sustained growth and therefore a monster quarter. And they were right. The company reported revenues of $3.84 billion, which is an increase of 23% compared year to year. That is also above the Wall Street estimate of $3.73 billion. The digital media business revenues, consisting of Creative Cloud and Document Cloud, grew by 25% compared to the previous year. The adjusted earnings per share were $3.03, which is higher than the estimated $2.81. For the following quarter, the company expects revenues of $3.88 billion and adjusted earnings per share of $3.00.

Conclusion

All these factors taken together, proven by positive index movements and earnings results better than anticipated, support the fact that the economic recovery is firmly underway, and those are very encouraging news.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Several new earnings reports and more management presentations this week

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We might be witnessing the lower volume of quarterly earnings reports this week, but that only means we passed last quarter’s report peak and we are getting ready for the June-quarter earnings season, which will hit us not long after the 4th of July. However, we do not lack many management presentations, which are typical after announcing earnings reports. This week brings us news for future result expectations from more than 30 companies, so let’s try and not miss any important clues. Besides earnings reports, this week is bringing us a total of 9 new IPOs like Marqeta, Inc. (NASDAQ: MQ), TaskUs, Inc. (NASDAQ: TASK), LifeStance Health Group, Inc. (NASDAQ: LFST), monday.com Ltd. (NASDAQ: MNDY), Zeta Global Holdings Corp.(NYSE: ZETA) and Jaws Hurricane Acquisition Corp (NASDAQ: HCNEU).

Monday

Yesterday we saw the first quarter report of fiscal 2022 for Marvell Technology (NASDAQ: MRVL), a Delaware-based company that develops and produces semiconductors and related technology. Marvel Technologies reported new revenues of $832 million, which is an increase of 20% year-to-year. GAAP gross profit margin was 50.2% and non-GAAP gross margin was 64.3%, while GAAP diluted loss per share was $0.13 and non-GAAP diluted income per share was $0.29.

Also, Vail Resorts, Inc. (NYSE: MTN) which owns and operates several premier mountain resorts in Colorado and California, reported fiscal 2021 third-quarter results yesterday. The report showed a net income of $274.6 million which is an increase of 80% compared to the third fiscal quarter of 2020. The reported EBITDA was $462.2 million, which is a significant increase from last year same quarter’s $304.4 million.

Tuesday

Besides earnings reports from Navistar International (NYSE: NAV) and Calavo Growers (NASDAQ: CVGW) on Tuesday, we are also expecting reports from Thor Industries (NYSE: THO), Casey’s General Stores (NASDAQ: CASY), and ABM Industries (NYSE: ABM).

Wednesday

Wednesday is reserved for earnings reports from Brown Forman (NYSE: BF-B), United Natural Foods (NYSE: UNFI), and Restoration Hardware (NYSE: RH). RH, the California-based furnishing company is expected to report earnings of $3.99 per share, which is growth of over 214% compared to the same period last year. Also, GameStop Corp (NYSE: GME), one of the world’s largest video game retailer’s earnings report is expected on Wednesday. The expected loss for the first quarter is $0.68 per share, which is an improvement from the same period last year (-%1.61 per share). In order to accelerate its transformation, the company decided to restructure its board, so it can keep up with industry growth and company expansion in the digital arena.

Thursday

On Thursday, we expect to see reports from National Beverage (NASDAQ: FIZZ), Chewy (NYSE: CHWY), and Dave & Buster’s (NASDAQ: PLAY). Chewy, the Florida-based pet store retailer, is expected to report a quarterly revenue growth of over 125%, compared year over year.

Friday

We are not expecting any major earnings reports on Friday.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

The week may be starting slowly but do not let that mislead you

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The celebration of Memorial Day in the U.S. caused the slower start, but the rest of the week will bring us plenty of news, updates, and earnings reports from companies like Zoom Video Communications (NASDAQ: ZM), Hewlett-Packard Enterprise (NYSE: HPE), Advanced Auto Parts (NYSE: AAP) and Slack Technologies, Inc. (NYSE: WORK). This week will also bring us news from the EV and the IPO worlds, as well as the 2021 Bitcoin conference, one of the biggest cryptocurrency events this year. Before we move to the day-to-day highlights, if you are a small business owner, do not miss today’s deadline to apply for the latest round of the Paycheck Protection Program funding.

Tuesday

This week’s earnings reports will be led by Kirkland’s Inc (NASDAQ: KIRK), and that is due before the market opens. It will be followed by HP’s and Zoom’s earnings reports, after the bell. SoFi Technologies (NYSE: SOFI) is a fintech startup IPO joining the trading world after its SPAC merger on Friday.

 

Wednesday

Before the market opens on Wednesday, we are expecting the earnings reports from Advance Auto Parts and Lands’ End Inc (NASDAQ: LE). The reports will keep coming after the bell as well, so we are keen to see how NetApp Inc (NASDAQ: NTAP), Endeavor Group Holdings (NYSE: EDR), Splunk Inc (NASDAQ: SPLK), and PVH Corp (NYSE: PVH) did in the previous period. Wednesday is also the day when we are expecting the Beige Book, which will give us the latest analysis of the economic conditions in the U.S. as the COVID-19 restrictions reduce.

Thursday

Thursday is expected to be the busiest of the week, when we expect earnings reports from Express Inc (NYSE: EXPR), Asana Inc (NYSE: ASAN), Duluth Holdings Inc (NASDAQ: DLTH), Broadcom Inc (NASDAQ: AVGO), The Toro Company (NYSE: TTC), The Cooper Companies (NYSE: COO), Science Applications International Corporation (NYSE: SAIC), Lululemon Athletica (NASDAQ: LULU), as well as Slack Technologies.

Thursday is a big day for NVIDIA Corporation (NASDAQ: NVDA) also. After reporting the record profits and earnings, highly affected by the company’s revenues from graphic cards for crypto mining, the shareholders will vote on a 4-for-1 stock split. That will increase the number of authorized shares of common stock, and if approved, each shareholder will receive an additional dividend of three additional shares.

Thursday will be also interesting in the automotive world. Kia will start taking reservations for its new EV6 crossover, while Nio Inc (NYSE: NIO), the Chinese automaker, will hold a general meeting so it can increase the diversity of its board.

This day will also be dominated by cryptocurrencies, as the 2021 Bitcoin conference, taking place in Miami, will kick-off.

Friday

The week’s end is reserved for the earnings report from Hooker Furniture Corporation (NASDAQ: HOFT), and that is expected before the opening bell. During the rest of Friday, we will focus on the latest unemployment rates and data.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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