Jefferies downgraded Datadog (DDOG) from Buy to Hold on Tuesday.
Analyst Brent Thill cited valuation concerns following the stock's 94% year-to-date surge. Shares fell more than 2% in pre-market trading following the announcement.
Jefferies raised its price target on the stock from $210 to $280. Thill noted that Datadog’s role as a primary AI spending beneficiary is now fully reflected in the share price.
The firm stated the downgrade stems from valuation rather than fundamental business concerns. Jefferies is seeking a more attractive entry point before turning constructive on the shares again.
Other analysts remain more bullish, with Barclays and Oppenheimer recently raising their own price targets.