Datadog Is Barking Up the Right Tree; Strong Enterprise Wins Drive Top-Line Growth; FVE to $192

We are raising our fair value estimate for Datadog to $192 from $153 after the firm closed out fiscal 2021 with results above our expectations. We are also revising growth estimates as the company exceeded our expectations on penetration in the enterprise market. We continue to have a positive outlook on the company as it benefits from secular tailwinds while executing strongly. In our opinion, Datadog’s sticky product portfolio, a driver behind its narrow economic moat, and strong upselling into the enterprise space will allow the firm to deliver continued shareholder value. Despite shares up 15% at the market open, we still view Datadog as attractively priced for investors looking for exposure to high-quality SaaS names.