Below we present the list of the 5 Best 52-Week Low Stocks To Buy Now. For our methodology and a more comprehensive list please see the 10 Best 52-Week Low Stocks To Buy Now.
5. Datadog, Inc. (NASDAQ:DDOG)
Number of Hedge Fund Shareholders: 81
1-Year Share Price Decline: 57.3%
Before we get into some of the biggest names in the tech industry, we’ll start with Datadog, Inc. (NASDAQ:DDOG), whose shares fell to a 2-year low on November 9. You’d never guess it based on DDOG shares losing 57% of their value over the last year, but the application performance and analytics company continues to execute at a high level, drive stellar growth, and get its customers spending more money. Datadog’s Q3 revenue ballooned by 61% to $437 million and unlike most other tech growth stocks, the company is already profitable, pulling in $304 million in operating cash flow during the first nine months of 2022. Thanks to its continued product innovation, Datadog is extremely effective at extracting more and more cash out of its customers, growing its net retention rate by more than 130% during the quarter, a feat it’s maintained for more than five years running.
Hedge funds haven’t been scared off by Datadog, Inc. (NASDAQ:DDOG)’s falling share price in 2022, as their collective ownership of the stock has continued to tick upwards this year, reaching an all-time high at the end of Q2. Philippe Laffont’s tech-focused fund Coatue Management added a large position in DDOG to its 13F portfolio during Q2, while fellow Tiger Cub Chase Coleman’s Tiger Global Management owned 1.81 million shares on June 30.
The Baron Global Advantage Fund is extremely bullish on Datadog, Inc. (NASDAQ:DDOG)’s operational excellence, as discussed in its Q1 2022 investor letter:
“Another example is Datadog, the leading infrastructure monitoring, application performance monitoring and log management software platform. Datadog’s stock declined 15% during the quarter, despite reporting sparkling operational results, with revenues accelerating to a growth rate of 84% year-over-year with 33% free cash flow margins, while guiding for 2022 significantly above expectations. Datadog added 4,600 new customers in the quarter, while existing customers continued to increase their spending on Datadog products at a rapid pace with the number of customers using four or more products increasing to 33% from 22% last year. While Datadog’s stock was down, its intrinsic value has undoubtedly increased. This is enabled by rapid innovation (Datadog released 13 new products in 2021) into a market that is benefiting from the secular growth in cloud, digital transformation, and the explosion in complexity as the number of vendors, diversity of technologies and related infrastructure continued to expand.”
