© Reuters. Weak observability checks push Datadog (DDOG) to neutral at BTIG
By Michael Elkins
BTIG downgraded Datadog Inc (NASDAQ:) to a Neutral rating (From Buy) following some worsening field checks over the last few weeks. However, analysts continue to view DDOG as a best-in-class player in the observability space.
During the field checks BTIG spoke to six contacts with a view on spending trends across the sector. All of them highlighted increasing headwinds in the space as customers look to optimize their cloud environments and rationalize expenditures with monitoring tools. As a result BTIG now forecasts 2024 revenue of $2,740 million, compared to the previous estimate of $2,842M, and are 8% below the current Street forecast.
The analysts wrote in a note, “We have a great deal of respect for the DDOG management team and the company’s ability to introduce and gain share with new products. However, with slowing growth at large scale cloud IaaS providers and increasing headwinds across the observability space, we see risk to Street estimates and potential for multiple contraction.”
Shares of DDOG are up 0.11% in early trading on Friday.
Be the first to comment