ClearBridge Investments released its third-quarter 2025 investor letter, reporting the S&P 500 Index surged 8.1% and the Nasdaq Composite rose 11.2%. The Russell 1000 Growth Index increased by 10.5%. The strategy underperformed due to exposure to perceived AI losers. Top five holdings can be viewed for more insights.

Datadog, Inc. (NASDAQ: DDOG) was highlighted in ClearBridge’s investor letter as a strong performer. The stock had a one-month return of 5.76% and a 52-week gain of 22.53%. On October 3, 2025, Datadog closed at $151.82 with a market cap of $52.946 billion.

ClearBridge’s third-quarter letter mentioned Datadog, Inc. (NASDAQ: DDOG) as a new position in their portfolio. They believe Datadog is a leader in cloud application monitoring with over 20% revenue growth potential. The company offers superior scalability and innovation in a growing market.

Despite Datadog, Inc. (NASDAQ: DDOG) not being in the top 30 hedge fund portfolios, it reported $827 million in revenue in Q2 2025. While the stock has potential, other AI stocks may offer better upside. Investors seeking undervalued AI stocks can explore the free report on the best short-term AI stock for more insights.

Read more at Yahoo Finance: What Makes Datadog (DDOG) a Lucrative Investment?