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Stifel Upgrades Datadog (DDOG) to Buy Ahead of Earnings, Sees Upside Surprise Potential

Datadog, Inc. (NASDAQ:DDOG) is one of the AI Stocks in Focus on Wall Street. On January 22, Stifel analyst Brad Reback upgraded the stock from Hold to Buy with a price target of $160.00 (from $205.00). The rating upgrade comes ahead Q4 2025 earnings report due on February 10, citing upside surprise potential and attractive long-term valuation.

According to the firm’s recent checks, DDOG is poised to post another larger than typical quarterly beat in Q4, an estimated 4% or more, driven by accelerating core growth, sustained strong gains within the non-OAI genAI cohort, and quarter-over-quarter stability in OpenAI performance.

The net result is we believe DDOG’s 4Q growth rate, excluding OAI, should be >23%. 

Looking ahead, Stifel anticipates management to guide calendar year 2026 revenue to an estimated $4.1 billion, implying conservative core growth above 19% excluding OpenAI.

The firm assumed OAI to remain at its current quarterly run rate of about $90 million through 2026, which leads to annual OAI revenue of $360 million compared to an estimated $305 million in 2025.

Stifel also discussed how DDOG has had recent success in S&M efforts and ongoing R&D investments, and that it would be surprised if management guided modestly below current Street expectations (~23%).

Net/net, with shares trading at ~8x CY27E EV/Rev and 30x CY27E EV/FCF, valuation appears relatively attractive for one of the few names we cover with accelerating core growth.

Datadog, Inc. (NASDAQ:DDOG) offers a cloud-based SaaS platform for monitoring and analytics, specializing in cloud computing and AI-powered cybersecurity products.

While we acknowledge the risk and potential of DDOG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DDOG and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 10 AI Stocks on Market Radar and 10 AI Stocks Analysts Are Watching

Disclosure: None.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

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