Wellington Management Group LLP Cuts Stake in DigitalOcean Holdings, Inc. $DOCN

Key Points

• Wellington Management cut its DigitalOcean stake by 46.8% in the second quarter, selling 1.38 million shares and retaining approximately 1.57 million shares valued at $247.1 million. Institutional investors collectively own 49.77% of DOCN.
• Analyst sentiment remains positive, with DigitalOcean receiving a consensus “Buy” rating and an average price target of $152.81. Recent targets range from $140 at UBS to $175 from Truist Financial and Morgan Stanley.
• DigitalOcean reported quarterly EPS of $0.45, exceeding estimates of $0.26, while revenue rose 28.6% year over year to $281.18 million. The stock opened at $111.50, versus a one-year range of $30.89 to $187.50.

Wellington Management Group LLP trimmed its holdings in DigitalOcean Holdings, Inc. (NYSE:DOCN - Free Report) by 46.8% in the 2nd quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The firm owned 1,573,295 shares of the company's stock after selling 1,383,571 shares during the quarter. Wellington Management Group LLP owned approximately 1.51% of DigitalOcean worth $247,055,000 as of its most recent SEC filing.

Other institutional investors have also added to or reduced their stakes in the company. Bank of America Corp DE purchased a new position in shares of DigitalOcean in the second quarter worth $241,945,000. Principal Financial Group Inc. increased its holdings in DigitalOcean by 155.3% in the 1st quarter. Principal Financial Group Inc. now owns 1,108,420 shares of the company's stock valued at $95,080,000 after acquiring an additional 674,231 shares during the last quarter. Alyeska Investment Group L.P. purchased a new stake in DigitalOcean in the 3rd quarter worth $21,808,000. Bank of New York Mellon Corp purchased a new stake in DigitalOcean in the 2nd quarter worth $98,011,000. Finally, Arrowstreet Capital Limited Partnership boosted its holdings in shares of DigitalOcean by 90.9% during the 4th 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. 49.77% of the stock is owned by hedge funds and other institutional investors.

Insider Buying and Selling at DigitalOcean

In other news, CAO Cherie Barrett sold 4,456 shares of the 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 sale, the chief accounting officer owned 65,487 shares of the company's stock, valued at approximately $8,668,514.19. This represents a 6.37% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Matt Steinfort sold 10,000 shares of the firm's stock in a transaction dated Tuesday, June 2nd. The stock was sold at an average price of $170.07, for a total transaction of $1,700,700.00. Following the completion of the sale, the chief financial officer owned 538,414 shares of the company's stock, valued at $91,568,068.98. This trade represents a 1.82% 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. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 18,656 shares of company stock worth $2,811,383 over the last quarter. Insiders own 0.96% of the company's stock.

Analyst Ratings Changes

A number of research analysts have recently weighed in on the company. Piper Sandler raised their price objective on DigitalOcean from $98.00 to $155.00 and gave the company a "neutral" rating in a research report on Tuesday, May 5th. William Blair restated an "outperform" rating on shares of DigitalOcean in a report on Wednesday, July 15th. Truist Financial assumed coverage on DigitalOcean in a research note on Thursday. They issued a "buy" rating and a $175.00 price objective on the stock. UBS Group cut their target price on shares of DigitalOcean from $155.00 to $140.00 and set a "neutral" rating for the company in a report on Wednesday, August 5th. Finally, Morgan Stanley boosted their price target on shares of DigitalOcean from $75.00 to $175.00 and gave the stock an "overweight" rating in a research report on Wednesday, May 6th. Two investment analysts have rated the stock with a Strong Buy rating, thirteen have given a Buy rating and two have issued a Hold rating to the stock. According to data from MarketBeat, DigitalOcean presently has a consensus rating of "Buy" and an average target price of $152.81.

DigitalOcean Price Performance

NYSE:DOCN opened at $111.50 on Monday. The firm has a market capitalization of $11.64 billion, a price-to-earnings ratio of 50.91, a PEG ratio of 95.20 and a beta of 1.61. The company has a debt-to-equity ratio of 1.14, a current ratio of 1.31 and a quick ratio of 1.31. The business has a 50 day simple moving average of $128.72 and a 200-day simple moving average of $115.77. DigitalOcean Holdings, Inc. has a 1 year low of $30.89 and a 1 year high of $187.50.

DigitalOcean (NYSE:DOCN - Get Free Report) last released its earnings results on Tuesday, August 4th. The company reported $0.45 earnings per share for the quarter, beating the consensus estimate of $0.26 by $0.19. The firm had revenue of $281.18 million for the quarter, compared to the consensus estimate of $279.03 million. DigitalOcean had a return on equity of 31.01% and a net margin of 23.26%.The company's revenue for the quarter was up 28.6% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.39 EPS. DigitalOcean has set its FY 2026 guidance at 1.350-1.400 EPS and its Q3 2026 guidance at 0.280-0.300 EPS. Equities analysts forecast that DigitalOcean Holdings, Inc. will post 0.63 EPS for the current year.

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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