One of the least talked about lessons from the pandemic has been the importance of good data.
After all, the federal Centers for Disease Control and the majority of states were making their decisions about mask mandates and re-openings based on statistics that were made available to the public.
And then there’s the mountain of data compiled by a group of researchers in Finland led by geneticist Andrea Ganna. Over the last 15 months, he’s compiled statistics pulled from more than 3,300 researchers in 25 countries. We’re talking stats about millions of people, including more than 125,000 Covid-19 patients.
All of which brings me around to one of my favorite tech-investing topics – cashing in on the Big Data sector that will be worth at least $229.4 billion in the next couple of years.
Big Data: The Ultimate Essential Service
Now then, Ganna’s massive genetics data project started out with the same question millions of us have – why do some people get through Covid with barely a fever while others spend weeks in the hospital, or even die. Ganna’s project to map how our DNA affects our bodies’ ability to deal with Covid has turned into one of the largest initiatives in genetics data ever put together.
As you can imagine, the amount of data they had to sift through is astounding. In fact, the story of Covid has in many ways been just that – the story of Big Data.
Take the website Worldometers.info. This online statistics portal was relatively unknown until Covid hit.
Then all of a sudden, millions of us started tracking up-to-date numbers on Covid infections, hospitalizations – all split up by country, by state, by age group, and so on.
The site has done a truly admirable job of presenting all this data in a readable way for us. But despite the avalanche of Covid details at our fingertips, this all pales in comparison to what’s going on with the larger world around us.
For example, we saw more than 300 million video chats happening every day last year. Not to mention the huge rise in movie streaming once movie theaters closed down.
The result is that research firm IDC estimates that 59 petabytes of data were made and consumed in 2020.
To give you an idea, 59 petabytes of 4K movies would take 147.5 years of non-stop binging to watch.
This data comes from the millions and millions of data generators all around us: smartwatches, medical devices, smartphones, speakers, thermostats, gaming consoles, laptops, and so on.
It’s why investing in Big Data can be so lucrative. According to MarketsandMarkets, this market will be worth an astonishing $229.4 billion by 2025.
But just collecting this data is worthless. The money is in the synthesis and analysis of data.
So, thousands of companies all over the world are willing to pay top dollar for actionable intelligence based on all this Big Data.
That’s where Datadog Inc. (DDOG), a cloud-management developer for businesses, comes in.
Subscribers to my Nova-X Report investing newsletter already got to hear about Datadog back in late July 2020. We saw a 56.8% gain on half of the trade by the end of October. You can be one of the first people to hear about the next opportunity like this one.
All you have to do is click here to see how.
To the Cloud!
Datadog’s unified cloud platform integrates all the metrics that corporate operations teams use to monitor their cloud apps and servers, as well as the logs the teams use to troubleshoot errors.
With millions shifting to full-time remote work and now to hybrid office/home work, Datadog’s platform has become indispensable to company IT teams.
Because Datadog has some key advantages over its competitors. A key differentiator is that Datadog’s platform also integrates the “traces” that a development team needs to see to determine how to fix an error once it’s spotted.
When the operations team notices a slowdown or error, they can immediately look into the logs and traces to see if it’s because of a hardware issue that they can solve, or a code issue the development team can fix.
This merging of development and operations into “devops” is a huge boon to companies running cloud services. It allows teams to constantly optimize speed and performance without getting into the blame-games or territorial fights that can plague traditional cloud development.
Datadog even helps companies fix issues before they happen. See, the company has built-in machine learning that predicts potential issues for a company’s cloud before they happen.
The machine learning system also runs constant marketing and business analysis, so that the devops team can optimize their systems for revenue as well.
Datadog’s latest earnings show just how popular and needed their cloud-management platform is in this post-Covid world. In fact, the company’s second-quarter profit, revenue, and guidance for the next quarter were all higher than Wall Street expected.
Datadog reported per-share earnings of 9 cents, three times higher than expected and up 80% from the year before. Revenue soared 67% to $233.5 million, almost 10% higher than analysts were counting on.
Datadog also reported having 59% more customers that make $100,000 a year or more. Each one is likely to stay as a customer and keep growing, giving Datadog a nice runway of future profits.
Now, Datadog’s profits were short over the last three years. But that is changing as the company’s sales growth is now falling to the bottom line.
Given its performance, I’m projecting earnings growth of 24% for the company. At that rate, they should double in three years.
With Big Data and cloud computing both taking over the world, Datadog is the perfect fit for your portfolio.
Cheers and good investing,
Michael A. Robinson