DigitalOcean (NYSE:DOCN) Stock Rating Raised to Strong-Buy at Zacks Research

DigitalOcean (NYSE:DOCN) was upgraded by analysts at Zacks Research from a “hold” rating to a “strong-buy” rating in a note issued to investors on Monday, Zacks reports.

Several other equities research analysts have also recently commented on the company. Weiss Ratings cut DigitalOcean from a “buy (b-)” rating to a “hold (c+)” rating in a report on Wednesday, September 9th. William Blair reaffirmed an “outperform” rating on shares of DigitalOcean in a research note on Wednesday, July 15th. Oppenheimer lifted their price target on DigitalOcean from $190.00 to $220.00 and gave the company an “outperform” rating in a research report on Wednesday, October 14th. Citigroup reissued a “market outperform” rating on shares of DigitalOcean in a research note on Thursday, October 15th. Finally, Robert W. Baird began coverage on DigitalOcean in a research note on Tuesday, July 21st. They issued an “outperform” rating and a $165.00 price objective on the stock. Two investment analysts have rated the stock with a Strong Buy rating, fourteen have given a Buy rating and two have assigned a Hold rating to the company’s stock. According to MarketBeat, the stock has an average rating of “Buy” and an average price target of $152.88.

DigitalOcean Stock Down 0.8%

DigitalOcean stock opened at $99.54 on Monday. The stock has a market cap of $10.39 billion, a price-to-earnings ratio of 45.45, a PEG ratio of 85.34 and a beta of 1.70. The company has a current ratio of 1.31, a quick ratio of 1.31 and a debt-to-equity ratio of 1.14. The company’s 50-day moving average price is $124.02 and its two-hundred day moving average price is $130.32. DigitalOcean has a 52 week low of $37.83 and a 52 week high of $187.50.

DigitalOcean (NYSE:DOCN) last issued its quarterly earnings results on Tuesday, August 4th. The company reported $0.45 earnings per share for the quarter, topping analysts’ consensus estimates of $0.26 by $0.19. The company had revenue of $281.18 million during the quarter, compared to analyst estimates of $279.03 million. DigitalOcean had a net margin of 23.26% and a return on equity of 31.01%. The business’s revenue for the quarter was up 28.6% compared to the same quarter last year. During the same period in the prior year, the business 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. On average, analysts expect that DigitalOcean will post 0.64 EPS for the current fiscal year.

Insider Activity

In related news, CAO Cherie Barrett sold 4,456 shares of the business’s stock in a transaction that occurred 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 directly owned 65,487 shares in the company, valued at $8,668,514.19. The trade was a 6.37% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available 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 stock in a transaction that occurred on Thursday, September 3rd. The shares were sold at an average price of $105.73, for a total transaction of $1,057,300.00. Following the sale, the chief financial officer directly owned 503,692 shares of the company’s stock, valued at approximately $53,255,355.16. This represents a 1.95% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 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. In the last quarter, insiders sold 22,641 shares of company stock worth $2,589,317. Corporate insiders own 0.96% of the company’s stock.

Institutional Trading of DigitalOcean

Large investors have recently added to or reduced their stakes in the business. Bank of America Corp DE purchased a new position in shares of DigitalOcean during the second quarter valued at $241,945,000. First Trust Advisors LP lifted its stake in DigitalOcean by 9.3% in the 1st quarter. First Trust Advisors LP now owns 1,441,151 shares of the company’s stock worth $123,622,000 after acquiring an additional 122,675 shares in the last quarter. Principal Financial Group Inc. lifted its stake in DigitalOcean by 155.3% in the 1st 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 in the last quarter. Allspring Global Investments Holdings LLC lifted its stake in DigitalOcean by 81.3% in the 1st quarter. Allspring Global Investments Holdings LLC now owns 683,707 shares of the company’s stock worth $59,947,000 after acquiring an additional 306,529 shares in the last quarter. Finally, Bank of New York Mellon Corp acquired a new stake in DigitalOcean during the 2nd quarter worth about $98,011,000. 49.77% of the stock is currently owned by institutional investors.

DigitalOcean Company Profile

DigitalOcean Holdings, Inc is a cloud computing company that provides infrastructure and developer-focused services for startups, small and medium-sized businesses, and individual developers. Its platform is designed to simplify the deployment, management, and scaling of applications without requiring customers to build and operate extensive in-house infrastructure.

The company’s offerings include Droplets, its virtual machine service; managed Kubernetes; managed databases; object and block storage; networking tools; and application deployment services through App Platform.