Datadog (DDOG) Stock Pullback Seen as Buying Opportunity for 2026

Datadog, Inc. (NASDAQ:DDOG) ranks among the best big data stocks to invest in. On December 29, MoffettNathanson reiterated its Buy rating and $255 price target for Datadog, Inc. (NASDAQ:DDOG), despite the stock’s recent fall from an all-time high back in November. The firm stated that Datadog, Inc. (NASDAQ:DDOG) had “one of the strongest quarters” within its coverage umbrella during the recent earnings period, benefiting greatly from AI-native operations throughout the year.

MoffettNathanson links the DDOG stock’s dip to “the market’s more cautious stance on the AI trade,” though it adds that the selloff is “overdone” and represents a “attractive buying opportunity” for buyers in 2026.

Datadog, Inc. (NASDAQ:DDOG) announced third-quarter revenue of $886 million, a 28% increase year-over-year and 4% above consensus. The company also reported that growth among both AI-native and non-AI clients has surged, with sequential usage rates among non-AI clients reaching a 12-quarter peak.

The company’s earnings per share of $0.55 also beat predictions by $0.09, while its free cash flow of $214 million crossed forecasts.

Datadog, Inc. (NASDAQ:DDOG) is a software company that provides an observability solution built for cloud-scale applications, monitoring servers, databases, tools, and services via its SaaS-based data analytics platform. The company’s tools serve as information technology monitoring and analytics solutions that allow for the examination of performance indicators and event tracking for cloud services.

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. This article is originally published at Insider Monkey.