Shares of Datadog (NASDAQ:DDOG) jumped on Thursday. The monitoring and analytics platform provider's shares rose as much as 5.8%. As of 1:15 p.m. EDT, however, the stock was up 3.8%.
The stock's gain was likely due to a combination of an upbeat day in the market for growth stocks in general as well as an analyst's move to upgrade his rating for the stock.
As the Nasdaq Composite gained 1.5% as of this writing on Thursday, many growth stocks like Datadog rose even more. This broader-market optimism for growth stocks, therefore, likely helped provide a lift to Datadog's stock today.
Also helping the stock was Monness Crespi analyst Brian White's move to upgrade his rating on Datadog stock from "neutral" to "buy." White's $100 12-month price target translates to more than 15% upside.
Datadog's business has been growing very rapidly. Fourth-quarter revenue was up 56% year over year.
Importantly, management expects more strong growth this year. The company guided for 2021 revenue between $825 million and $835 million, up from 2020 revenue of about $604 million.
"In 2020, we enhanced our positioning as the most complete and cloud-native end-to-end observability platform," explained Datadog Co-founder and CEO Olivier Pomel in the company's Q4 earnings release in February. "But we are even more excited for what's to come, and plan for meaningful continued investments to enhance our long-term positioning."