DigitalOcean Holdings, Inc. (NYSE:DOCN) Stock Has Average Price Target of $141.06

Key Points

• Analyst sentiment is broadly positive: 18 brokerages give DigitalOcean a “Moderate Buy” consensus, with 14 buy and two strong-buy ratings; the average 12-month price target is $141.06.
• Recent results beat expectations: DigitalOcean reported quarterly EPS of $0.45 versus a $0.32 consensus estimate and revenue of $321.19 million versus expectations of $306.74 million. Revenue grew 39.6% year over year.
• Analyst views are not unanimous: Weiss Ratings downgraded the stock to sell, while UBS lowered its price target to $100 and assigned a neutral rating.

Shares of DigitalOcean Holdings, Inc. (NYSE:DOCN - Get Free Report) have earned an average recommendation of "Moderate Buy" from the eighteen brokerages that are currently covering the firm, Marketbeat.com reports. One research analyst has rated the stock with a sell rating, one has assigned a hold rating, fourteen have issued a buy rating and two have assigned a strong buy rating to the company. The average twelve-month price target among brokerages that have updated their coverage on the stock in the last year is $141.06.

Several analysts recently commented on the company. Weiss Ratings lowered DigitalOcean from a "hold (c+)" rating to a "sell (d+)" rating in a research note on Wednesday, November 4th. William Blair reiterated an "outperform" rating on shares of DigitalOcean in a research note on Wednesday, July 15th. UBS Group cut their price objective on DigitalOcean from $105.00 to $100.00 and set a "neutral" rating for the company in a report on Wednesday, November 4th. KeyCorp restated an "overweight" rating on shares of DigitalOcean in a research note on Tuesday, October 13th. Finally, Stifel Nicolaus set a $130.00 target price on shares of DigitalOcean in a report on Tuesday, November 3rd.

DigitalOcean Stock Performance

NYSE:DOCN opened at $79.37 on Wednesday. The firm's 50-day moving average is $115.07 and its 200-day moving average is $111.94. DigitalOcean has a 52-week low of $41.96 and a 52-week high of $187.50. The company has a debt-to-equity ratio of 0.61, a quick ratio of 1.15 and a current ratio of 1.15. The company has a market cap of $9.37 billion, a price-to-earnings ratio of 256.03, a PEG ratio of 97.36 and a beta of 1.69.

DigitalOcean (NYSE:DOCN - Get Free Report) last issued its earnings results on Tuesday, November 3rd. The company reported $0.45 EPS for the quarter, topping the consensus estimate of $0.32 by $0.13. DigitalOcean had a return on equity of 15.01% and a net margin of 3.11%. The firm had revenue of $321.19 million during the quarter, compared to analysts' expectations of $306.74 million. During the same period last year, the business earned $0.54 earnings per share. DigitalOcean's quarterly revenue was up 39.6% compared to the same quarter last year. Equities research analysts anticipate that DigitalOcean will post 0.65 earnings per share for the current year.

Insider Buying and Selling

In related news, CFO Matt Steinfort sold 10,000 shares of the stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $105.73, for a total transaction of $1,057,300.00. Following the sale, the chief financial officer directly owned 503,692 shares in the company, valued at $53,255,355.16. This represents a 1.95% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CAO Cherie Barrett sold 4,456 shares of DigitalOcean stock in a transaction on Thursday, August 13th. The shares were sold at an average price of $132.37, for a total value of $589,840.72. Following the completion of the transaction, the chief accounting officer owned 65,487 shares of the company's stock, valued at approximately $8,668,514.19. The trade was a 6.37% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 18,441 shares of company stock valued at $2,068,475 in the last quarter. 0.96% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Large investors have recently bought and sold shares of the company. Bank of America Corp DE bought a new stake in shares of DigitalOcean during the second quarter worth $241,945,000. First Trust Advisors LP boosted its holdings in DigitalOcean by 9.3% in the first quarter. First Trust Advisors LP now owns 1,441,151 shares of the company's stock valued at $123,622,000 after acquiring an additional 122,675 shares during the last quarter. Stephens Investment Management Group LLC bought a new position in DigitalOcean in the third quarter valued at about $98,056,000. Bank of New York Mellon Corp acquired a new stake in DigitalOcean in the second quarter worth about $98,011,000. Finally, Principal Financial Group Inc. increased its position in DigitalOcean by 155.3% in the first quarter. Principal Financial Group Inc. now owns 1,108,420 shares of the company's stock worth $95,080,000 after purchasing an additional 674,231 shares during the period. Institutional investors and hedge funds own 49.77% of the company's stock.

About DigitalOcean

DigitalOcean Holdings, Inc. provides cloud computing services designed primarily for developers, startups, and small and midsize businesses. Founded in 2011, the company focuses on making it easier for customers to build, deploy, and scale applications without managing their own physical infrastructure. Its platform includes virtual machines known as Droplets, managed Kubernetes, an application platform, managed databases, object storage, and networking and monitoring tools. These services support tasks ranging from hosting websites and applications to developing and running cloud-native software.

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