Datadog (DDOG)
All three bubble tests hold: (1) forward P/E is 105.73x against a peer median of 17.03x, a ratio of 6.21x, well above the 1.75x threshold; (2) trailing P/E is 571.64x and P/S is 25.42, so earnings already delivered are thin relative to the price, and PEG is 4.27; (3) latest-quarter revenue grew 35.6% year over year (PRIMARY, EDGAR) — strong, but below 50% — so merely continuing that growth cannot close a 6.21x gap, and the price requires demand and earnings to accelerate for years. Delivered demand check: the Application software group's median growth was 14.9% — demand rising, but nowhere near the rate this price assumes for Datadog alone.
What would change this label: Downgrade the bubble call to OVERVALUED if the forward P/E compresses below about 51x (3.0x the peer median) at unchanged estimates, or if revenue growth accelerates above 50% year over year with PEG falling below 1.5. The bubble case strengthens if growth falls below 25% year over year while the forward P/E stays above 90x.
Datadog is a good, fast-growing software company, but its shares cost about 106 times the profit expected next year — about six times what similar software companies cost. Its sales grew 36%, which is strong but not nearly enough to justify that gap. The price assumes near-perfect growth for many years, which is why it is labelled a bubble.
Both lines start at 100 on 2020-09-01. Over the full window Datadog returned +227.41% and the S&P 500 +118.28% (price returns; dividends not reinvested). Worst peak-to-trough fall for Datadog: -68.1% (2021-11-09 to 2023-04-25). Source: Nasdaq official daily history.
What the label rests on
All three bubble tests hold: (1) forward P/E is 105.73x against a peer median of 17.03x, a ratio of 6.21x, well above the 1.75x threshold; (2) trailing P/E is 571.64x and P/S is 25.42, so earnings already delivered are thin relative to the price, and PEG is 4.27; (3) latest-quarter revenue grew 35.6% year over year (PRIMARY, EDGAR) — strong, but below 50% — so merely continuing that growth cannot close a 6.21x gap, and the price requires demand and earnings to accelerate for years. Delivered demand check: the Application software group's median growth was 14.9% — demand rising, but nowhere near the rate this price assumes for Datadog alone. The company’s forward P/E is 105.7× against a peer median of 17.0×. Its own history: UNVERIFIED — no sourced range available. Sector demand read: Delivered demand check: the Application software group's median latest-quarter revenue growth was 14.9% year over year (SEC filings) — demand rising. Latest-quarter sales growth was +35.6% versus a year earlier (SEC filings).
| Company | Price (Oct 28, 2026) | Forward P/E | Trailing P/E |
|---|---|---|---|
| Datadog (DDOG) | $280.37 | 105.7× | 571.6× |
| ADBE | $248.09 | 9.2× | 13.8× |
| CDNS | $336.92 | 35.8× | 67.0× |
| SNPS | $474.42 | 26.9× | 84.1× |
| INTU | $328.07 | 13.8× | 19.9× |
| WDAY | $205.46 | 17.0× | 42.3× |
| Peer median | 17.0× |
Multiples: stockanalysis.com (SECONDARY, S&P Global data), fetched Oct 28, 2026. Peer set chosen by sector; the median is the middle value of the set. The label and its numbers were recorded in the programme’s label registry on Oct 28, 2026 and will be scored at 6 and 12 months.
Sales, profit and cash
Gross margin = gross profit divided by sales, from SEC filings.
Free cash flow = cash from operations minus spending on plant and equipment, both from the company’s SEC cash-flow statement. Gaps are quarters where that spending line is not separately tagged in the filings — shown as gaps, never estimated.
| Quarter | Sales | Gross margin | Net income | EPS (GAAP, diluted) | Free cash flow |
|---|---|---|---|---|---|
| Q/E Jun 2026 2026-06-30 | $1.1B | 78.6% | $45M | 0.12 | $306M |
| Q/E Mar 2026 2026-03-31 | $1.0B | 79.2% | $53M | 0.15 | $323M |
| Q/E Dec 2025 2025-12-31 | $953M | 80.4% | $47M | — | $318M |
| Q/E Sep 2025 2025-09-30 | $886M | 80.1% | $34M | 0.10 | $235M |
| Q/E Jun 2025 2025-06-30 | $827M | 79.9% | $3M | 0.01 | $185M |
| Q/E Mar 2025 2025-03-31 | $762M | 79.3% | $25M | 0.07 | $263M |
| Q/E Dec 2024 2024-12-31 | $738M | 80.5% | $46M | — | $257M |
| Q/E Sep 2024 2024-09-30 | $690M | 80.0% | $52M | 0.14 | $220M |
| Q/E Jun 2024 2024-06-30 | $645M | 80.9% | $44M | 0.12 | $160M |
| Q/E Mar 2024 2024-03-31 | $611M | 82.0% | $43M | 0.12 | $198M |
| Q/E Dec 2023 2023-12-31 | $590M | 82.2% | $54M | — | $210M |
| Q/E Sep 2023 2023-09-30 | $548M | 81.1% | $23M | 0.06 | $147M |
The last twelve reported quarters. Full 24-quarter history sits in the data pack behind this page. A dash means the figure is not tagged as a standalone quarter in the company’s SEC facts (the usual case is the fourth quarter, which many companies only report inside the full-year filing) — it is missing, not zero.
Earnings: getting better or worse?
Each box is one quarter’s earnings per share (EPS). Green means EPS was higher than the same quarter a year earlier; red means lower; a dash means the figure is not tagged in the filings.
Basis: GAAP diluted EPS from SEC company facts, compared with the same quarter a year earlier.
Key facts
| Item | Value |
|---|---|
| Company (legal name in filings) | Datadog, Inc. |
| Chief executive | Olivier Pomel (source: https://www.reuters.com/business/datadog-beats-quarterly-results-estimates-ai-driven-demand-cloud-security-2026-02-10/) |
| Sector | Technology — Application Software — sells cloud monitoring, observability and security software |
| Share price (Oct 28, 2026) | $280.37 |
| Market value (market cap) | $104.2B — share price times shares outstanding of 371,023,000 (SEC filings; SEC EDGAR WeightedAverageNumberOfDilutedSharesOutstanding (latest quarter; dei EntityCommonStockSharesOutstanding series is stale for this filer)) |
| Sales, last twelve months | $4.0B |
| Net income, last twelve months | $178M |
| Free cash flow, last twelve months | $1.2B |
| Latest reported quarter | Q/E Jun 2026 (of 24 quarters in the data pack) |
| Six-year price return vs S&P 500 | +227.41% vs +118.28% |
| Worst peak-to-trough fall | -68.1% (2021-11-09 to 2023-04-25) |
What we could not verify
- TTM GAAP diluted EPS could not be summed from company facts because at least one of the last four quarters (typically Q4) has no standalone tagged EPS; trailing P/E is therefore taken from the labelled secondary source in valuation_label.md.
- Own-history P/E range not yet compiled for this company in the Phase 1 batch run; the label rests on peer-median, growth and PEG evidence.
- Guidance record (each quarter scored against the guidance the company gave the quarter before) is not yet compiled for this company — it is a Phase 2 layer. The earnings strip below therefore uses reported EPS versus a year earlier, which is fully sourced from filings.
The IT factor — the most exciting thing the market is overlooking — is not assessed on an X-Ray page. It belongs to the Deep Dive (Phase 2), where it gets the evidence standard it needs. Leadership-era scoring (the six years split by chief executive) is likewise a Phase 2 layer; this page names the current chief executive only, from a sourced profile.
Sources
- SEC EDGAR submissions — Filing index; company legal name.
https://data.sec.gov/submissions/CIK0001561550.json - SEC EDGAR company facts — Quarterly financial spine: revenue, gross profit, net income, GAAP diluted EPS, operating cash flow, PP&E capex, buybacks, dividends, diluted shares.
https://data.sec.gov/api/xbrl/companyfacts/CIK0001561550.json - Nasdaq official daily history — Daily closes for the company; SPY (assetclass=etf) saved as raw/nasdaq_spy_raw.json over identical dates.
https://api.nasdaq.com/api/quote/DDOG/historical?assetclass=stocks - Valuation multiples and peer figures — stockanalysis.com (SECONDARY, S&P Global data), fetched Oct 28, 2026; see valuation_label.md in the data pack.
Conventions: earliest-filed value per period, as first reported; cash-flow years-to-date differenced quarter by quarter; EPS never differenced; free cash flow = operating cash flow minus plant-and-equipment spending. This page is a dated snapshot — updates are new versions, never silent edits.