Datadog Stock And Two AI Plays Riding SpaceX Supercomputing Wave

SpaceX’s record IPO and its US$60b purchase of AI start up Cursor have pulled artificial intelligence investing back into the spotlight, and not just for SpaceX stock. When a newly listed company with a US$2tn valuation leans hard into AI and supercomputing, capital and attention often ripple into other large companies tied to similar themes. This article picks out 3 stocks from an AI Trend screener that look closely exposed to the same news, helping you decide which opportunities might deserve a closer look and which risks to keep on your radar.

Datadog (DDOG)

Overview: Datadog is a cloud software company that helps businesses monitor, secure, and understand their applications and infrastructure in real time, from servers and databases to user activity and AI models. Its platform pulls together metrics, logs, traces, and security data so teams can spot problems faster, keep services running, and manage complex AI heavy systems more confidently.

Operations: Datadog generates all of its US$3.7b revenue from Information Technology (IT) Infrastructure across the United States (US$2.5b), International markets (US$1.0b), and North America excluding the United States (US$118.7m).

Market Cap: US$81.8b

Datadog provides observability and security tools that help companies keep cloud and AI workloads reliable as usage expands. This role is particularly relevant as SpaceX allocates fresh IPO capital to AI and supercomputing. The company offers AI focused products such as Bits AI and GPU Monitoring and reports growing traction with large and government customers. At the same time, a rich valuation, margin pressure, reliance on larger AI customers, and recent insider selling indicate that expectations are high and execution needs to remain tight. Investors watching Datadog are considering AI related demand in the context of these valuation and profitability pressures.

Datadog’s expanding role in AI heavy infrastructure is notable, but the key question is whether its rich valuation and margin pressure are fully priced in. As a result, it may be worth reviewing the analysis report for Datadog

Dynatrace (DT)

Overview: Dynatrace is a software company that runs an AI powered observability platform, helping large organisations monitor, secure, and analyse their applications, infrastructure, and digital customer experiences so issues can be identified and automated fixes can be triggered in real time. Its tools sit across complex cloud and AI workloads, turning large volumes of telemetry data into insights that IT and security teams can act on quickly.

Operations: Dynatrace generates US$2.0b in revenue from Internet Software & Services, with sales spread across the United States, Europe, the Middle East and Africa, Asia Pacific, Latin America, and the rest of North America.

Market Cap: US$11.9b

Dynatrace sits in the slipstream of the SpaceX AI push, because its AI powered observability and automation tools are built to support large scale, complex cloud and AI deployments that enterprises are rolling out. Recurring revenue, high gross margins and adoption of its Grail data platform and AI features have caught the attention of both analysts and an activist investor focused on higher margins and stronger capital returns. At the same time, recent margin compression and a high P/E highlight that execution still matters. If you are interested in how Dynatrace could participate as AI workloads expand and why some investors still see room for improvement, the rest of this section explores the trade off between growth, valuation and risk in more detail.

Dynatrace’s high P/E and recent margin pressure suggest the full story is not in the headline numbers. Before you decide how this AI observability play fits your watchlist, scan the 2 key rewards and 1 important warning sign

Penguin Solutions (PENG)

Overview: Penguin Solutions is a Fremont based enterprise hardware and services company that builds high performance computing and AI infrastructure, memory products, and LED solutions for OEM, enterprise, and government customers across data centers and edge locations.

Operations: Penguin Solutions generates US$1.3b in revenue, split across Integrated Memory (US$570.4m), Advanced Computing (US$538.0m), and Optimized LED (US$239.8m).

Market Cap: US$3.3b

Penguin Solutions sits in the slipstream of the SpaceX Cursor deal because it sells the type of AI infrastructure, CXL based memory, and OriginAI platform capabilities that are needed as conversational and agentic AI workloads move from experiments to large scale deployments. Recent comments about CXL orders for inference workloads, the SK Telecom investment, and new partnerships with Dell Technologies and Deepgram highlight growing demand. Earnings growth forecasts and recent guidance reaffirmation show why some investors are watching the stock closely. At the same time, a rich P/E, reliance on large, lumpy AI projects, tariff exposure in the Optimized LED segment, and insider selling mean expectations are high and execution risk is real for Penguin Solutions.

Penguin Solutions’ accelerating AI infrastructure story, rich P/E, and reliance on large projects raise a key question about how much risk is already baked in, so walk through the 2 key rewards and 2 important warning signs

The three stocks covered here are only a starting point, as the full Artificial Intelligence (AI) Trend screener surfaced 26 more companies with equally compelling AI related narratives that could change how you think about this trend. Use Simply Wall St to identify and analyze the specific catalysts, financial health checks, and AI mentions that matter to you so you can focus on the highest conviction ideas in this theme.

Take Control of Your Investment Journey

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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