Datadog (DDOG) Seen as Software Top Pick as AI Momentum Builds

Datadog, Inc. (NASDAQ:DDOG) is one of the 10 AI Stocks Gaining Attention on Wall Street. On February 2, DA Davidson analyst Gil Luria reiterated a Buy rating on the stock with a $225.00 price target. The firm calls DDOG a Top Pick in Software and a clear AI winner with long runway for higher growth.

DA Davidson highlighted that DDOG is a top pick in software, but it doesn’t anticipate it to guide aggressively right now, similar to other software names. In an investor note, it said that it does anticipate another quarter of momentum with AI Natives for DataDog, possibly driving an outsized earnings beat and sustain strong growth through the remainder of the year.

However, the firm believes that management is unlikely to break from its pattern and will try to match the current consensus instead of materially exceeding expectations. Despite the conservative guidance, DA Davidson believes DDOG is a clear AI winner whose AI-native momentum will drive strong growth.

“We continue to view Datadog as a high growth company with a long runway and clear AI winner. Reiterate BUY rating.”

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. This article is originally published at Insider Monkey.