Robert W. Baird Upgrades DigitalOcean (NYSE:DOCN) to "Strong-Buy"

Key Points

• Robert W. Baird upgraded DigitalOcean to a “strong-buy”, adding to a broadly positive Wall Street view of the stock.
• Analyst sentiment is largely bullish overall, with 2 Strong Buy ratings, 12 Buy ratings, and a consensus price target of $151.93.
• DigitalOcean rose 4.8% to $142.96 and recently reported Q1 EPS of $0.44, beating estimates and topping revenue expectations with $257.9 million in sales.

DigitalOcean (NYSE:DOCN - Get Free Report) was upgraded by stock analysts at Robert W. Baird to a "strong-buy" rating in a report released on Tuesday,Zacks.com reports.

DOCN has been the topic of several other reports. Oppenheimer set a $190.00 price objective on shares of DigitalOcean in a report on Wednesday, May 6th. Bank of America boosted their target price on shares of DigitalOcean from $103.00 to $107.00 and gave the stock a "buy" rating in a research note on Thursday, April 9th. KeyCorp assumed coverage on shares of DigitalOcean in a research report on Tuesday, June 2nd. They set an "overweight" rating and a $200.00 price target for the company. Citigroup raised their price target on shares of DigitalOcean from $180.00 to $185.00 and gave the company a "buy" rating in a research note on Wednesday, July 8th. Finally, Barclays decreased their price target on shares of DigitalOcean from $184.00 to $160.00 and set an "overweight" rating on the stock in a research note on Tuesday. Two research analysts have rated the stock with a Strong Buy rating, twelve have assigned a Buy rating and two have issued a Hold rating to the company's stock. According to MarketBeat.com, DigitalOcean has a consensus rating of "Buy" and a consensus target price of $151.93.

DigitalOcean Trading Up 4.8%

Shares of DOCN stock opened at $142.96 on Tuesday. The company has a debt-to-equity ratio of 0.92, a current ratio of 1.46 and a quick ratio of 1.46. The company has a market cap of $14.92 billion, a price-to-earnings ratio of 62.43 and a beta of 1.57. The stock has a 50 day simple moving average of $152.37 and a 200-day simple moving average of $103.16. DigitalOcean 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 earnings results on Tuesday, May 5th. The company reported $0.44 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.27 by $0.17. DigitalOcean had a return on equity of 88.86% and a net margin of 24.97%.The firm had revenue of $257.90 million for the quarter, compared to analyst estimates of $249.76 million. During the same quarter last year, the firm posted $0.56 EPS. The business's revenue was up 22.4% on a year-over-year basis. 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, equities research analysts expect that DigitalOcean will post 0.56 EPS for the current fiscal year.

Insider Buying and Selling at DigitalOcean

In other DigitalOcean news, CFO Matt Steinfort sold 10,000 shares of DigitalOcean stock in a transaction on Tuesday, June 2nd. The shares were sold at an average price of $170.07, for a total transaction of $1,700,700.00. Following the sale, the chief financial officer owned 538,414 shares of the company's stock, valued at $91,568,068.98. The trade was a 1.82% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. 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, Director Hilary Schneider sold 4,338 shares of the company'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 sale, the director directly owned 24,323 shares of the company's stock, valued at $3,803,630.74. The trade was a 15.14% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders have sold 39,338 shares of company stock worth $6,191,576. 0.96% of the stock is currently owned by corporate insiders.

Institutional Trading of DigitalOcean

Hedge funds have recently bought and sold shares of the business. Hilltop National Bank purchased a new position in DigitalOcean in the 2nd quarter worth approximately $38,000. Parallel Advisors LLC boosted its holdings in shares of DigitalOcean by 66.2% during the 1st quarter. Parallel Advisors LLC now owns 324 shares of the company's stock worth $28,000 after purchasing an additional 129 shares during the last quarter. Banque Cantonale Vaudoise purchased a new stake in shares of DigitalOcean in the first quarter valued at approximately $33,000. LRI Investments LLC purchased a new stake in shares of DigitalOcean in the second quarter valued at approximately $64,000. Finally, Optiver Holding B.V. increased its holdings in shares of DigitalOcean by 1,063.9% in the first quarter. Optiver Holding B.V. now owns 419 shares of the company's stock valued at $36,000 after purchasing an additional 383 shares during the last quarter. Institutional investors and hedge funds own 49.77% of the company's stock.

About DigitalOcean

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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