Morgan Stanley Forecasts Strong Price Appreciation for DigitalOcean (NYSE:DOCN) Stock

Key Points

• Morgan Stanley raised DigitalOcean's price target from $41.00 to $44.00, indicating a potential upside of 20.35% and maintaining an "overweight" rating on the stock.
• DigitalOcean's recent quarterly earnings surpassed expectations, reporting $0.59 EPS and $218.70 million in revenue, with a year-over-year revenue increase of 13.6%.
• Several analysts have different ratings for DigitalOcean, with five rating it as a hold, seven as a buy, and one as a sell, leading to a consensus rating of "Hold."

DigitalOcean (NYSE:DOCN - Free Report) had its target price raised by Morgan Stanley from $41.00 to $44.00 in a research report report published on Wednesday,Benzinga reports. Morgan Stanley currently has an overweight rating on the stock.

A number of other equities research analysts have also recently commented on DOCN. Wall Street Zen raised shares of DigitalOcean from a "hold" rating to a "buy" rating in a report on Sunday, June 29th. UBS Group lowered their target price on shares of DigitalOcean from $44.00 to $32.00 and set a "neutral" rating on the stock in a report on Thursday, May 8th. Needham & Company LLC reiterated a "hold" rating on shares of DigitalOcean in a research report on Tuesday, May 6th. Barclays upped their price objective on DigitalOcean from $38.00 to $40.00 and gave the stock an "overweight" rating in a report on Wednesday. Finally, The Goldman Sachs Group cut their price target on shares of DigitalOcean from $46.00 to $41.00 and set a "buy" rating for the company in a report on Wednesday, May 7th. One investment analyst has rated the stock with a sell rating, five have assigned a hold rating and seven have issued a buy rating to the stock. According to MarketBeat.com, the company has a consensus rating of "Hold" and an average target price of $41.45.

DigitalOcean Stock Down 5.2%

DigitalOcean stock traded down $1.79 during midday trading on Wednesday, reaching $32.55. The company's stock had a trading volume of 1,366,182 shares, compared to its average volume of 1,570,271. The business has a 50-day simple moving average of $28.87 and a 200-day simple moving average of $32.95. The company has a market cap of $2.96 billion, a P/E ratio of 25.11, a P/E/G ratio of 2.67 and a beta of 1.75. DigitalOcean has a fifty-two week low of $25.45 and a fifty-two week high of $47.02.

DigitalOcean (NYSE:DOCN - Get Free Report) last announced its quarterly earnings results on Tuesday, August 5th. The company reported $0.59 EPS for the quarter, topping the consensus estimate of $0.47 by $0.12. DigitalOcean had a net margin of 15.18% and a negative return on equity of 73.19%. The firm had revenue of $218.70 million for the quarter, compared to analyst estimates of $216.62 million. During the same period last year, the business earned $0.48 EPS. DigitalOcean's revenue for the quarter was up 13.6% compared to the same quarter last year. As a group, equities analysts forecast that DigitalOcean will post 1.01 earnings per share for the current year.

Insiders Place Their Bets

In other DigitalOcean news, insider Bratin Saha sold 3,461 shares of DigitalOcean stock in a transaction on Wednesday, June 18th. The shares were sold at an average price of $27.77, for a total value of $96,111.97. Following the completion of the transaction, the insider owned 294,546 shares of the company's stock, valued at $8,179,542.42. The trade was a 1.16% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through this link. 0.96% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On DigitalOcean

Hedge funds have recently made changes to their positions in the business. Geode Capital Management LLC lifted its holdings in shares of DigitalOcean by 0.6% during the fourth quarter. Geode Capital Management LLC now owns 1,473,421 shares of the company's stock valued at $50,211,000 after purchasing an additional 9,088 shares during the last quarter. Envestnet Asset Management Inc. boosted its holdings in shares of DigitalOcean by 66.5% in the fourth quarter. Envestnet Asset Management Inc. now owns 82,558 shares of the company's stock worth $2,813,000 after buying an additional 32,966 shares during the period. Russell Investments Group Ltd. increased its position in shares of DigitalOcean by 11.7% in the fourth quarter. Russell Investments Group Ltd. now owns 162,467 shares of the company's stock worth $5,535,000 after acquiring an additional 17,025 shares in the last quarter. Legal & General Group Plc raised its holdings in shares of DigitalOcean by 2.1% during the fourth quarter. Legal & General Group Plc now owns 182,674 shares of the company's stock valued at $6,224,000 after acquiring an additional 3,783 shares during the period. Finally, Renaissance Technologies LLC lifted its position in shares of DigitalOcean by 11.7% in the 4th quarter. Renaissance Technologies LLC now owns 488,700 shares of the company's stock valued at $16,650,000 after acquiring an additional 51,000 shares in the last quarter. Institutional investors own 49.77% of the company's stock.

DigitalOcean Company Profile

DigitalOcean Holdings, Inc, through its subsidiaries, operates a cloud computing platform in North America, Europe, Asia, and internationally. The company's platform provides on-demand infrastructure and platform tools for developers, start-ups, and small and growing digital businesses. It also offers infrastructure-as-a-service (IaaS) solutions comprising compute and storage services, as well as networking projects, including Cloud Firewalls software, Managed Load Balancers software, and Virtual Private Cloud (VPC).