Hodges Capital Management Inc. Purchases Shares of 121,960 DigitalOcean Holdings, Inc. $DOCN

Key Points

• Hodges Capital Management opened a new position in DigitalOcean, buying 121,960 shares valued at about $10.46 million in the first quarter.
• DigitalOcean reported better-than-expected Q1 earnings of $0.44 per share on revenue of $257.9 million, with revenue up 22.4% year over year.
• Wall Street remains bullish on the stock, with analysts assigning a Moderate Buy rating and an average price target of $146.36, though insiders have also sold shares recently.

Hodges Capital Management Inc. acquired a new position in shares of DigitalOcean Holdings, Inc. (NYSE:DOCN - Free Report) during the 1st quarter, according to its most recent filing with the SEC. The institutional investor acquired 121,960 shares of the company's stock, valued at approximately $10,462,000. Hodges Capital Management Inc. owned 0.12% of DigitalOcean at the end of the most recent reporting period.

Several other hedge funds have also modified their holdings of DOCN. Banque Cantonale Vaudoise purchased a new stake in DigitalOcean in the first quarter valued at approximately $33,000. Huntington National Bank raised its stake in DigitalOcean by 638.3% during the fourth quarter. Huntington National Bank now owns 598 shares of the company's stock worth $29,000 after purchasing an additional 517 shares during the period. NBC Securities Inc. acquired a new position in shares of DigitalOcean in the 4th quarter valued at $32,000. Allworth Financial LP boosted its holdings in shares of DigitalOcean by 54.4% in the 3rd quarter. Allworth Financial LP now owns 724 shares of the company's stock valued at $25,000 after purchasing an additional 255 shares during the last quarter. Finally, Transamerica Financial Advisors LLC grew its stake in shares of DigitalOcean by 417.9% during the 4th quarter. Transamerica Financial Advisors LLC now owns 782 shares of the company's stock valued at $38,000 after buying an additional 631 shares during the period. 49.77% of the stock is owned by institutional investors and hedge funds.

DigitalOcean Stock Down 0.2%

Shares of NYSE DOCN opened at $129.91 on Monday. The stock has a fifty day moving average price of $152.40 and a 200 day moving average price of $95.68. The company has a current ratio of 1.46, a quick ratio of 1.46 and a debt-to-equity ratio of 0.92. DigitalOcean Holdings, Inc. has a 12-month low of $25.56 and a 12-month high of $187.50. The company has a market cap of $13.56 billion, a P/E ratio of 56.73 and a beta of 1.57.

DigitalOcean (NYSE:DOCN - Get Free Report) last issued its earnings results on Tuesday, May 5th. The company reported $0.44 earnings per share for the quarter, topping the consensus estimate 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 $257.90 million during the quarter, compared to the consensus estimate of $249.76 million. During the same quarter in the prior year, the business earned $0.56 earnings per share. The company's revenue was up 22.4% compared to the same quarter last year. DigitalOcean has set its Q2 2026 guidance at 0.200-0.230 EPS and its FY 2026 guidance at 1.100-1.200 EPS. Research analysts anticipate that DigitalOcean Holdings, Inc. will post 0.54 EPS for the current fiscal year.

Wall Street Analysts Forecast Growth

A number of research firms have recently commented on DOCN. UBS Group upped their price objective on DigitalOcean to $175.00 and gave the stock a "neutral" rating in a report on Tuesday, May 12th. KeyCorp began coverage on DigitalOcean in a research report on Tuesday, June 2nd. They set an "overweight" rating and a $200.00 price target for the company. The Goldman Sachs Group upped their price target on DigitalOcean from $78.00 to $179.00 and gave the stock a "buy" rating in a research note on Wednesday, May 6th. Citizens Jmp raised their price objective on DigitalOcean from $83.00 to $105.00 and gave the stock a "market outperform" rating in a report on Thursday, March 26th. Finally, Oppenheimer set a $190.00 price objective on DigitalOcean in a research note on Wednesday, May 6th. One analyst has rated the stock with a Strong Buy rating, nine have given a Buy rating and three have assigned a Hold rating to the company. According to MarketBeat, the company has an average rating of "Moderate Buy" and an average price target of $146.36.

Insider Activity at DigitalOcean

In other news, CFO Matt Steinfort sold 25,000 shares of DigitalOcean stock in a transaction that occurred on 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 sale, the chief financial officer owned 573,272 shares in the company, valued at $87,423,980. This trade represents a 4.18% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, Director Hilary Schneider sold 4,338 shares of the business's stock in a transaction on Friday, May 15th. The stock was sold at an average price of $156.38, for a total transaction of $678,376.44. Following the transaction, the director directly owned 24,323 shares in the company, valued at approximately $3,803,630.74. The trade was a 15.14% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 39,338 shares of company stock worth $6,191,576 over the last three months. 0.96% of the stock is currently owned by corporate 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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