Wedbush Adds Datadog and SK Hynix to AI 30 List
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: seekingalpha
- Memory Super-Cycle: Wedbush analysts highlight that the unprecedented demand for HBM, DRAM, and NAND in AI infrastructure has led to the strongest pricing power for memory manufacturers in over a decade, with DRAM and NAND prices expected to rise significantly in the second half of 2026, enhancing profitability for these companies.
- Core Beneficiary Status of SK Hynix: Analysts believe SK Hynix is a key beneficiary of the memory super-cycle, as hyperscaler capital expenditures increase, positioning it as a major winner in the AI revolution, with the market significantly underestimating the duration and magnitude of this cycle.
- Datadog's AI Monitoring Demand: Wedbush notes that Datadog stands out as a second derivative beneficiary of the AI revolution, driven by the growing need for companies to monitor, secure, and optimize their AI workloads, indicating strong market potential in the coming years.
- Expansion of Cloud Workloads: Analysts emphasize that as AI and cloud workloads continue to scale, Datadog is well-positioned to capitalize on this multi-year shift, further enhancing its competitive edge in the market.
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Analyst Views on DDOG
Wall Street analysts forecast DDOG stock price to fall
33 Analyst Rating
30 Buy
3 Hold
0 Sell
Strong Buy
Current: 218.040
Low
140.00
Averages
207.39
High
255.00
Current: 218.040
Low
140.00
Averages
207.39
High
255.00
About DDOG
Datadog, Inc. provides an observability and security platform for cloud applications. The Company’s SaaS platform integrates and automates infrastructure monitoring, application performance monitoring, log management, user experience monitoring, cloud security and many other capabilities to provide unified, real-time observability and security for its customers’ entire technology stack. Its platform consists of products that can be used individually or as a unified solution and includes a marketplace where customers can access products built by its partners on top of the Datadog platform. Its products include Infrastructure Monitoring, Application Performance Monitoring, Log Management, Digital Experience Monitoring, Continuous Profiler, Database Monitoring, Data Observability, Universal Service Monitoring, Network Monitoring and others. It owns Metaplane, an end-to-end data observability platform that provides advanced machine learning-powered monitoring and column-level lineage.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
The Trade Desk Shares Surge Amid Cooling Treasury Yields
- Share Price Recovery: The Trade Desk's shares surged 3.1% in the afternoon session, reaching $22.13, which is a 4% increase from the previous close, indicating market confidence in its future growth potential.
- Interest Rate Impact: A drop in the 10-year Treasury yield can boost SaaS valuations by 5-10%, highlighting the market's sensitivity to long-duration cash flows, particularly given the high renewal rates of these contracts.
- Market Sentiment Shift: With progress in Iran peace talks, market sentiment has calmed, leading investors to focus on SaaS companies that can leverage AI to extend their competitive moats, suggesting a healthier market environment compared to the previous day's broad sell-off.
- Long-term Underperformance: Despite today's rebound, The Trade Desk has declined 41.3% since the beginning of the year, and its current share price remains 75.4% below its 52-week high, reflecting ongoing concerns about its future growth trajectory.
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- Consumer Sentiment Decline: The University of Michigan's consumer sentiment index was revised down to a record low of 44.8, below the expected 48.2, indicating growing concerns among consumers about the economic outlook, which may impact future spending.
- Rising Inflation Expectations: The 1-year inflation expectations for May were revised upward to 4.8%, exceeding the expected 4.6%, potentially prompting the Federal Reserve to consider interest rate hikes in upcoming meetings, which could pressure the stock market.
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- Strong Market Performance: The S&P 500 rose by 0.50% and the Nasdaq 100 by 0.73%, with the Dow Jones Industrial Average hitting an all-time high, reflecting optimism about a potential US-Iran peace deal that could boost investor confidence.
- Decline in Consumer Confidence: The University of Michigan's consumer sentiment index was revised down to 44.8, a record low, below the expected 48.2, indicating growing consumer concerns about the economic outlook, which may negatively impact future spending.
- Rising Inflation Expectations: The 1-year inflation expectations for May were revised up to 4.8%, a 9-month high, exceeding the expected 4.6%, which could prompt the Fed to consider interest rate hikes at the upcoming meeting, affecting market liquidity.
- Chip Stocks Lead Gains: Qualcomm's stock surged over 12%, leading the Nasdaq 100, demonstrating ongoing market enthusiasm for semiconductor and AI infrastructure, which may yield higher returns for related companies.
See More
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- Strong Market Performance: The S&P 500 rose by 0.54%, the Nasdaq 100 increased by 0.53%, and the Dow Jones Industrial Average reached an all-time high, reflecting market optimism regarding a potential peace deal between the US and Iran, which could boost investor confidence.
- Software Stocks Lead Gains: Workday's stock surged over 8% after reporting Q1 adjusted EPS of $2.66, exceeding the consensus of $2.51, and forecasting Q2 subscription revenue of $2.46 billion, further enhancing confidence in the software sector.
- Oil Price Volatility Affects Markets: Crude oil prices dipped slightly as Qatar coordinated with the US to send a negotiating team to Tehran, raising concerns about future supply; the IEA warned that global oil inventories will remain tight, potentially impacting overall economic growth.
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See More
Wedbush Adds Datadog and SK Hynix to AI 30 List
- Memory Super-Cycle: Wedbush analysts highlight that the unprecedented demand for HBM, DRAM, and NAND in AI infrastructure has led to the strongest pricing power for memory manufacturers in over a decade, with DRAM and NAND prices expected to rise significantly in the second half of 2026, enhancing profitability for these companies.
- Core Beneficiary Status of SK Hynix: Analysts believe SK Hynix is a key beneficiary of the memory super-cycle, as hyperscaler capital expenditures increase, positioning it as a major winner in the AI revolution, with the market significantly underestimating the duration and magnitude of this cycle.
- Datadog's AI Monitoring Demand: Wedbush notes that Datadog stands out as a second derivative beneficiary of the AI revolution, driven by the growing need for companies to monitor, secure, and optimize their AI workloads, indicating strong market potential in the coming years.
- Expansion of Cloud Workloads: Analysts emphasize that as AI and cloud workloads continue to scale, Datadog is well-positioned to capitalize on this multi-year shift, further enhancing its competitive edge in the market.
See More
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- Industry Performance Divergence: Over the past six months, the software sector has declined by 9.2%, contrasting sharply with the S&P 500's 11.6% return, highlighting the volatility risks associated with high valuations.
- Autodesk Financial Concerns: Autodesk's annual revenue growth of 13.7% falls below industry standards, and the lengthy customer acquisition cost recovery period hampers justifying sales and marketing investments, negatively impacting profitability.
- Wix Operational Challenges: Wix's average billings growth of only 13.8% and a 12.2 percentage point drop in operating margin indicate competitive pressures, with a projected 10.6 percentage point decline in free cash flow margin next year reflecting increased investment needs.
- Datadog's Positive Market Outlook: Datadog's annual recurring revenue (ARR) trends indicate a steady flow of long-term contracts, with expectations of significant market share gains in the next 12 months, and quick payback periods on sales and marketing expenses allow for substantial customer acquisition investments.
See More
The Trade Desk Shares Surge Amid Cooling Treasury Yields
- Share Price Recovery: The Trade Desk's shares surged 3.1% in the afternoon session, reaching $22.13, which is a 4% increase from the previous close, indicating market confidence in its future growth potential.
- Interest Rate Impact: A drop in the 10-year Treasury yield can boost SaaS valuations by 5-10%, highlighting the market's sensitivity to long-duration cash flows, particularly given the high renewal rates of these contracts.
- Market Sentiment Shift: With progress in Iran peace talks, market sentiment has calmed, leading investors to focus on SaaS companies that can leverage AI to extend their competitive moats, suggesting a healthier market environment compared to the previous day's broad sell-off.
- Long-term Underperformance: Despite today's rebound, The Trade Desk has declined 41.3% since the beginning of the year, and its current share price remains 75.4% below its 52-week high, reflecting ongoing concerns about its future growth trajectory.
See More
US Stocks Close Higher as Market Sentiment Improves
- Market Recovery: The S&P 500 rose by 0.37% and the Nasdaq 100 by 0.42%, with the Dow Jones Industrial Average hitting an all-time high, reflecting optimism about a potential US-Iran peace deal that could boost investor confidence.
- Consumer Sentiment Decline: The University of Michigan's consumer sentiment index was revised down to a record low of 44.8, below the expected 48.2, indicating growing concerns among consumers about the economic outlook, which may impact future spending.
- Rising Inflation Expectations: The 1-year inflation expectations for May were revised upward to 4.8%, exceeding the expected 4.6%, potentially prompting the Federal Reserve to consider interest rate hikes in upcoming meetings, which could pressure the stock market.
- Tech Stocks Lead Gains: Workday's stock surged over 5% after reporting Q1 adjusted EPS of $2.66, surpassing expectations, highlighting strong performance in the software sector and potentially attracting more investor interest in tech stocks.
See More
US Stocks Rise, Nasdaq Hits Weekly High
- Strong Market Performance: The S&P 500 rose by 0.50% and the Nasdaq 100 by 0.73%, with the Dow Jones Industrial Average hitting an all-time high, reflecting optimism about a potential US-Iran peace deal that could boost investor confidence.
- Decline in Consumer Confidence: The University of Michigan's consumer sentiment index was revised down to 44.8, a record low, below the expected 48.2, indicating growing consumer concerns about the economic outlook, which may negatively impact future spending.
- Rising Inflation Expectations: The 1-year inflation expectations for May were revised up to 4.8%, a 9-month high, exceeding the expected 4.6%, which could prompt the Fed to consider interest rate hikes at the upcoming meeting, affecting market liquidity.
- Chip Stocks Lead Gains: Qualcomm's stock surged over 12%, leading the Nasdaq 100, demonstrating ongoing market enthusiasm for semiconductor and AI infrastructure, which may yield higher returns for related companies.
See More
US Stocks Rise as Market Optimism Grows
- Strong Market Performance: The S&P 500 rose by 0.54%, the Nasdaq 100 increased by 0.53%, and the Dow Jones Industrial Average reached an all-time high, reflecting market optimism regarding a potential peace deal between the US and Iran, which could boost investor confidence.
- Software Stocks Lead Gains: Workday's stock surged over 8% after reporting Q1 adjusted EPS of $2.66, exceeding the consensus of $2.51, and forecasting Q2 subscription revenue of $2.46 billion, further enhancing confidence in the software sector.
- Oil Price Volatility Affects Markets: Crude oil prices dipped slightly as Qatar coordinated with the US to send a negotiating team to Tehran, raising concerns about future supply; the IEA warned that global oil inventories will remain tight, potentially impacting overall economic growth.
- International Markets Rebound: The Euro Stoxx 50 climbed 1.23%, China's Shanghai Composite rose 0.87%, and Japan's Nikkei increased by 2.68%, indicating a global market optimism that may provide support for the US market.
See More
Wedbush Adds Datadog and SK Hynix to AI 30 List
- Memory Super-Cycle: Wedbush analysts highlight that the unprecedented demand for HBM, DRAM, and NAND in AI infrastructure has led to the strongest pricing power for memory manufacturers in over a decade, with DRAM and NAND prices expected to rise significantly in the second half of 2026, enhancing profitability for these companies.
- Core Beneficiary Status of SK Hynix: Analysts believe SK Hynix is a key beneficiary of the memory super-cycle, as hyperscaler capital expenditures increase, positioning it as a major winner in the AI revolution, with the market significantly underestimating the duration and magnitude of this cycle.
- Datadog's AI Monitoring Demand: Wedbush notes that Datadog stands out as a second derivative beneficiary of the AI revolution, driven by the growing need for companies to monitor, secure, and optimize their AI workloads, indicating strong market potential in the coming years.
- Expansion of Cloud Workloads: Analysts emphasize that as AI and cloud workloads continue to scale, Datadog is well-positioned to capitalize on this multi-year shift, further enhancing its competitive edge in the market.
See More
Investment Opportunities in the Software Sector
- Industry Performance Divergence: Over the past six months, the software sector has declined by 9.2%, contrasting sharply with the S&P 500's 11.6% return, highlighting the volatility risks associated with high valuations.
- Autodesk Financial Concerns: Autodesk's annual revenue growth of 13.7% falls below industry standards, and the lengthy customer acquisition cost recovery period hampers justifying sales and marketing investments, negatively impacting profitability.
- Wix Operational Challenges: Wix's average billings growth of only 13.8% and a 12.2 percentage point drop in operating margin indicate competitive pressures, with a projected 10.6 percentage point decline in free cash flow margin next year reflecting increased investment needs.
- Datadog's Positive Market Outlook: Datadog's annual recurring revenue (ARR) trends indicate a steady flow of long-term contracts, with expectations of significant market share gains in the next 12 months, and quick payback periods on sales and marketing expenses allow for substantial customer acquisition investments.
See More
