Shares of Snowflake Inc.
SNOW,
+10.66%,
MongoDB Inc.
MDB,
+11.04%
and Elastic NV
ESTC,
+6.53%
were all rallying sharply in Tuesday’s premarket trading after Datadog Inc.’s
DDOG,
+28.47%
upbeat earnings report eased fears about consumption-based software companies for the latest quarter. Snowflake shares were up more than 8%, while MongoDB shares were up about 6% and Elastic shares were ahead about 4%. Datadog’s stock was surging more than 24% after the software company, which Mizuho desk-based analyst Jordan Klein called “clearly one of the most shorted and over-sold names” in all of software as well as among consumption-based players, topped expectations with its latest results and outlook. “Other peers like SNOW, MDB and ESTC yet to report should bounce, but also a good sign for AWS and Azure demand trends in my view and broader software,” wrote Klein, who’s associated with Mizuho’s sales team and not its research arm.