Datadog (DDOG) Up 54%-Analyst Still Bullish Heading Into Q2 Results

Datadog, Inc. (NASDAQ:DDOG) is one of the AI Stocks Analysts Are Watching Closely. On August 4, UBS analyst Karl Keirstead reiterated a “Buy” rating on the stock with a $165.00 price target.

The company is expected to report earnings for the fiscal quarter ending June 2025 on 08/07/2025 before market open. The firm believes that Datadog is heading into earnings with strong cloud tailwinds overblown concerns regarding OpenAI.

However, the recent 54% rally since early April makes the stock less compelling.

“Ahead of Datadog’s 2Q25 print on Thursday morning, we review the key debates, including overall observability software spending trends, the health of the OpenAI-Datadog relationship and the impact of the (slightly) disappointing AWS results."

Here's why the firm is still leaning positive to Datadog:

"While the 54% rally in the stock since early-April (the shares are back to 12x/42x on CY26E revs/FCF) makes the set-up less compelling, we still lean positive given Datadog’s correlation to a very healthy cloud infra market as well as our view that the Street is over-indexing too negative on the OpenAI risk.”

Datadog, Inc. (NASDAQ:DDOG) offers a cloud-based SaaS platform for monitoring and analytics, specializing in cloud computing and AI-powered cybersecurity products.

While we acknowledge the potential of DDOG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.