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Datadog & CrowdStrike: Two Growth Stocks for Long-Term Investors
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Published in Stocks and Investing on Sunday, December 28th 2025 at 10:35 GMT by The Motley Fool- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
Two Growth Stocks to Hold Through Thick and Thin: A Decade-Long Investment Strategy
The Motley Fool recently highlighted two compelling growth stocks poised for significant long-term appreciation – Datadog (DDOG) and CrowdStrike (CRWD). In an article published December 28, 2024, contributor Park Kibler argues that these companies possess strong fundamentals, address expanding market opportunities, and demonstrate a commitment to innovation, making them suitable candidates for buy-and-hold investors with a decade-long horizon. The piece emphasizes the importance of weathering short-term volatility to reap substantial rewards from their future growth.
The Case for Datadog: Monitoring the Modern Digital Landscape
Datadog is presented as a leader in observability – essentially, providing companies with tools to monitor and analyze the performance of their applications, infrastructure, and cloud environments. Kibler points out that modern businesses are increasingly reliant on complex digital ecosystems, built upon microservices, containers, and cloud platforms. This complexity creates a critical need for robust monitoring solutions, and Datadog is uniquely positioned to capitalize on this demand.
The article emphasizes Datadog's “land-and-expand” sales model as a key driver of its growth. Companies often start with a small implementation of Datadog’s core product and then expand their usage across different teams and applications, leading to increased recurring revenue. This stickiness contributes significantly to the company’s impressive customer retention rates. As detailed in Datadog's Investor Relations section (linked within the original article), their dollar-based net retention rate consistently exceeds 100%, signifying that existing customers are spending more with the company over time.
Kibler highlights several factors underpinning Datadog's long-term potential: the growing adoption of cloud computing, the increasing complexity of digital infrastructure, and the expansion of Datadog’s product offerings beyond its core monitoring capabilities. The acquisition of Hologram in 2021 (as mentioned in a related article linked within the Fool piece) demonstrated Datadog's commitment to expanding into mobile application observability, further broadening their market reach. The company is also actively developing AI-powered features to automate analysis and improve efficiency for its customers.
CrowdStrike: Cybersecurity in an Age of Escalating Threats
The second stock featured, CrowdStrike, operates in the cybersecurity space. The article argues that CrowdStrike isn’t just a security vendor; it's a critical defense against increasingly sophisticated cyberattacks targeting businesses of all sizes. With geopolitical tensions rising and ransomware attacks becoming more prevalent, the demand for robust cybersecurity solutions is only expected to intensify.
CrowdStrike’s Falcon platform, delivered via a cloud-native architecture, is central to its success. The article emphasizes the platform's breadth – covering endpoint protection, threat intelligence, identity management, and more – offering customers a comprehensive security solution. This "all-in-one" approach simplifies security management and reduces costs for businesses. As explained in CrowdStrike’s own documentation (referenced within the Fool piece), this modular design also allows clients to adopt features as needed, contributing to the land-and-expand strategy similar to Datadog.
Kibler points out that CrowdStrike benefits from a recurring revenue model and high gross margins, characteristic of software-as-a-service (SaaS) businesses. The company’s strong financial performance and consistent growth are further supported by its leadership position in the endpoint security market – a position solidified through strategic acquisitions like Firefly Technologies.
Risks to Consider: Navigating Potential Headwinds
While both companies present compelling investment opportunities, Kibler acknowledges potential risks. For Datadog, competition from other observability platforms (like New Relic and Dynatrace) is a constant concern. The article also notes that economic downturns could lead businesses to cut back on spending on non-essential services like monitoring tools.
CrowdStrike faces its own set of challenges. The cybersecurity landscape is constantly evolving, requiring continuous innovation to stay ahead of emerging threats. Increased competition in the crowded cybersecurity market and potential regulatory changes are also factors investors should consider. Furthermore, as highlighted by analysts quoted in the original article, CrowdStrike’s valuation remains relatively high, which could limit its upside potential if growth slows down.
The Long-Term Perspective: Patience is Key
The core message of the Fool's article isn’t about quick riches. It emphasizes a long-term investment horizon – ideally 10 years or more. Kibler stresses that both Datadog and CrowdStrike will likely experience periods of volatility, driven by market sentiment and macroeconomic conditions. However, he believes that their strong fundamentals, innovative products, and expanding markets will ultimately drive significant appreciation over the next decade.
The article advocates for a disciplined approach: buying shares when valuations are reasonable (or even slightly undervalued) and holding them through inevitable downturns. This requires an investor who can ignore short-term noise and focus on the long-term growth potential of these companies. While past performance is not indicative of future results, the article’s optimistic outlook rests on the belief that Datadog and CrowdStrike are well-positioned to continue dominating their respective markets for years to come.
Disclaimer: This summary is based solely on the provided URL and does not constitute financial advice. Investing in stocks carries inherent risks, and individuals should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.
Read the Full The Motley Fool Article at:
[ https://www.fool.com/investing/2025/12/28/2-growth-stocks-to-buy-and-hold-for-a-decade/ ]
