Canaccord Genuity Group Reiterates "Buy" Rating for DigitalOcean (NYSE:DOCN)

Key Points

• Canaccord Genuity Group reiterated its Buy rating on DigitalOcean and set a $200 price target, implying about 16.9% upside from the prior close.
• DigitalOcean reported a strong quarter, with EPS of $0.44 beating estimates and revenue of $257.91 million topping expectations; revenue also rose 22.4% year over year.
• Despite the upbeat analyst and earnings backdrop, the stock was down 0.3% on Thursday, while recent insider selling included shares sold by the CFO and a director.

DigitalOcean (NYSE:DOCN - Get Free Report)'s stock had its "buy" rating reiterated by investment analysts at Canaccord Genuity Group in a report issued on Thursday,Benzinga reports. They presently have a $200.00 target price on the stock. Canaccord Genuity Group's price objective would indicate a potential upside of 16.94% from the company's previous close.

A number of other analysts have also recently weighed in on the company. Citizens Jmp raised their price target on DigitalOcean from $83.00 to $105.00 and gave the company a "market outperform" rating in a research note on Thursday, March 26th. KeyCorp assumed coverage on DigitalOcean in a report on Tuesday, June 2nd. They set an "overweight" rating and a $200.00 price objective on the stock. Stifel Nicolaus set a $57.00 price objective on DigitalOcean in a report on Tuesday, February 24th. Morgan Stanley raised their price objective on DigitalOcean from $75.00 to $175.00 and gave the stock an "overweight" rating in a report on Wednesday, May 6th. Finally, Bank of America raised their price objective on DigitalOcean from $103.00 to $107.00 and gave the stock a "buy" rating in a report on Thursday, April 9th. One investment analyst has rated the stock with a Strong Buy rating, nine have issued a Buy rating and three have given a Hold rating to the company's stock. Based on data from MarketBeat, the company presently has a consensus rating of "Moderate Buy" and a consensus price target of $146.36.

DigitalOcean Stock Down 0.3%

DigitalOcean stock traded down $0.45 during midday trading on Thursday, reaching $171.03. The company's stock had a trading volume of 938,732 shares, compared to its average volume of 3,891,109. DigitalOcean has a fifty-two week low of $25.56 and a fifty-two week high of $184.46. The company has a quick ratio of 1.46, a current ratio of 1.46 and a debt-to-equity ratio of 0.92. The company has a market cap of $17.85 billion, a P/E ratio of 74.89 and a beta of 1.60. The business has a 50-day simple moving average of $127.88 and a 200-day simple moving average of $82.31.

DigitalOcean (NYSE:DOCN - Get Free Report) last posted its quarterly earnings results on Tuesday, May 5th. The company reported $0.44 earnings per share for the quarter, beating analysts' consensus estimates of $0.27 by $0.17. DigitalOcean had a return on equity of 88.86% and a net margin of 24.97%.The company had revenue of $257.91 million for the quarter, compared to analysts' expectations of $249.76 million. During the same period last year, the firm earned $0.56 earnings per share. DigitalOcean's quarterly revenue was up 22.4% on a year-over-year basis. DigitalOcean has set its Q2 2026 guidance at 0.200-0.230 EPS and its FY 2026 guidance at 1.100-1.200 EPS. On average, research analysts expect that DigitalOcean will post 0.54 earnings per share for the current fiscal year.

Insiders Place Their Bets

In related news, CFO Matt Steinfort sold 25,000 shares of the business's stock in a transaction dated Friday, May 15th. The stock was sold at an average price of $152.50, for a total value of $3,812,500.00. Following the transaction, the chief financial officer owned 573,272 shares in the company, valued at $87,423,980. The trade was a 4.18% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at the SEC website. Also, Director Hilary Schneider sold 4,338 shares of the business's stock in a transaction dated Friday, May 15th. The shares were sold at an average price of $156.38, for a total value of $678,376.44. Following the completion of the transaction, the director owned 24,323 shares in the company, valued at $3,803,630.74. This trade represents a 15.14% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders sold 39,338 shares of company stock worth $6,191,576. 0.96% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On DigitalOcean

Several institutional investors have recently added to or reduced their stakes in the stock. Allworth Financial LP boosted its stake in shares of DigitalOcean by 54.4% during the 3rd quarter. Allworth Financial LP now owns 724 shares of the company's stock worth $25,000 after acquiring an additional 255 shares in the last quarter. Parallel Advisors LLC boosted its stake in shares of DigitalOcean by 66.2% during the 1st quarter. Parallel Advisors LLC now owns 324 shares of the company's stock worth $28,000 after acquiring an additional 129 shares in the last quarter. Huntington National Bank boosted its stake in shares of DigitalOcean by 638.3% during the 4th quarter. Huntington National Bank now owns 598 shares of the company's stock worth $29,000 after acquiring an additional 517 shares in the last quarter. NBC Securities Inc. purchased a new stake in shares of DigitalOcean during the 4th quarter worth approximately $32,000. Finally, Banque Cantonale Vaudoise purchased a new stake in shares of DigitalOcean during the 1st quarter worth approximately $33,000. Institutional investors and hedge funds own 49.77% of the company's stock.

DigitalOcean Company Profile

DigitalOcean Holdings, Inc is a cloud infrastructure provider that focuses on simplicity, performance and developer experience. The company offers a range of cloud services designed to help software developers, startups and small- to medium-sized businesses deploy, manage and scale applications. Its flagship offering, Droplets, provides virtual private servers that can be configured with various CPU, memory and storage options. In addition to compute instances, DigitalOcean's platform includes managed Kubernetes, scalable object and block storage, managed databases, load balancers and networking capabilities such as Virtual Private Cloud (VPC) and Floating IPs.

Founded in 2011 and headquartered in New York City, DigitalOcean was created with the goal of making cloud computing more accessible to individual developers and smaller teams.

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