Granahan Investment Management LLC Invests $2.89 Million in DigitalOcean Holdings, Inc. $DOCN

Key Points

• Granahan Investment Management opened a new position in DigitalOcean, buying 33,699 shares worth about $2.89 million in the first quarter.
• DigitalOcean reported better-than-expected Q1 earnings, with EPS of $0.44 versus $0.27 expected and revenue of $257.9 million, up 22.4% year over year.
• Analyst sentiment remains broadly positive: the stock has a Buy consensus rating, though several firms recently adjusted price targets, and insiders have also sold shares in recent months.

Granahan Investment Management LLC bought a new position in shares of DigitalOcean Holdings, Inc. (NYSE:DOCN - Free Report) in the 1st quarter, according to the company in its most recent disclosure with the SEC. The fund bought 33,699 shares of the company's stock, valued at approximately $2,891,000.

A number of other institutional investors and hedge funds have also bought and sold shares of the stock. Principal Financial Group Inc. lifted its position in DigitalOcean by 155.3% during the first quarter. Principal Financial Group Inc. now owns 1,108,420 shares of the company's stock worth $95,080,000 after acquiring an additional 674,231 shares during the last quarter. Alyeska Investment Group L.P. bought a new stake in shares of DigitalOcean during the third quarter worth approximately $21,808,000. Arrowstreet Capital Limited Partnership grew its position in shares of DigitalOcean by 90.9% in the fourth quarter. Arrowstreet Capital Limited Partnership now owns 1,194,845 shares of the company's stock valued at $57,496,000 after purchasing an additional 568,823 shares during the last quarter. Franklin Resources Inc. grew its position in shares of DigitalOcean by 784.2% in the fourth quarter. Franklin Resources Inc. now owns 494,314 shares of the company's stock valued at $23,786,000 after purchasing an additional 438,411 shares during the last quarter. Finally, Danske Bank A S bought a new position in shares of DigitalOcean during the third quarter worth approximately $14,582,000. Institutional investors and hedge funds own 49.77% of the company's stock.

DigitalOcean Trading Down 5.7%

Shares of DOCN stock opened at $123.65 on Friday. The company has a current ratio of 1.46, a quick ratio of 1.46 and a debt-to-equity ratio of 0.92. The stock has a market cap of $12.90 billion, a P/E ratio of 53.99 and a beta of 1.57. The stock has a 50 day simple moving average of $151.20 and a 200 day simple moving average of $103.88. DigitalOcean Holdings, Inc. has a 1 year low of $25.56 and a 1 year high of $187.50.

DigitalOcean (NYSE:DOCN - Get Free Report) last announced its quarterly earnings data on Tuesday, May 5th. The company reported $0.44 earnings per share for the quarter, beating the consensus estimate of $0.27 by $0.17. The firm had revenue of $257.90 million during the quarter, compared to analysts' expectations of $249.76 million. DigitalOcean had a return on equity of 88.86% and a net margin of 24.97%.The company's quarterly revenue was up 22.4% compared to the same quarter last year. During the same period in the previous year, the firm earned $0.56 EPS. 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 predict that DigitalOcean Holdings, Inc. will post 0.56 earnings per share for the current fiscal year.

Wall Street Analyst Weigh In

DOCN has been the subject of several research reports. Piper Sandler lifted their price target on DigitalOcean from $98.00 to $155.00 and gave the stock a "neutral" rating in a report on Tuesday, May 5th. Morgan Stanley upped their price objective on DigitalOcean from $75.00 to $175.00 and gave the company an "overweight" rating in a report on Wednesday, May 6th. Canaccord Genuity Group reiterated a "buy" rating and set a $200.00 price objective on shares of DigitalOcean in a research report on Friday, July 10th. UBS Group dropped their target price on DigitalOcean from $175.00 to $155.00 and set a "neutral" rating for the company in a report on Wednesday, July 8th. Finally, Barclays reduced their target price on shares of DigitalOcean from $184.00 to $160.00 and set an "overweight" rating for the company in a research report on Tuesday. Two research analysts have rated the stock with a Strong Buy rating, twelve have issued a Buy rating and two have assigned a Hold rating to the company. According to data from MarketBeat.com, DigitalOcean currently has a consensus rating of "Buy" and an average target price of $151.93.

Insider Transactions at DigitalOcean

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

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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