Here’s Why DataDog Stock Dropped 11% Last Month

From Nasdaq: 2024-08-08 02:52:07

Datadog’s stock (NASDAQ: DDOG) dropped 11% in July due to global IT outage concerns and market volatility. The tech sector, including Datadog, faced challenges with decreased investor risk tolerance and uncertainty. Reports of a potential acquisition added to the stock’s fluctuations before the August financial report.

The market trends affected Datadog similarly to other tech stocks mid-July. A software glitch caused computer crashes globally, impacting tech companies like Datadog, CrowdStrike (NASDAQ: CRWD), and Microsoft (NASDAQ: MSFT). Despite stable revenue and profit forecasts, the stock’s decline was attributed to market momentum and risk aversion.

Rumors of Datadog acquiring GitLab (NASDAQ: GTLB) drove discussion in the market, though financial constraints and high valuations raised concerns. The interest in GitLab, with its high P/E ratio, suggests Datadog may face financial challenges. The uncertain future, expensive deal, and high investor expectations contributed to Datadog’s stock volatility.

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