DigitalOcean (NYSE:DOCN) Shares Gap Up – What’s Next?

DigitalOcean Holdings, Inc. (NYSE:DOCN) gapped up prior to trading on Tuesday . The stock had previously closed at $131.37, but opened at $145.00. DigitalOcean shares last traded at $139.5680, with a volume of 981,599 shares changing hands.

Analyst Ratings Changes

Several equities analysts have recently issued reports on the stock. The Goldman Sachs Group lifted their price objective on shares of DigitalOcean from $78.00 to $179.00 and gave the stock a “buy” rating in a research note on Wednesday, May 6th. UBS Group raised their target price on shares of DigitalOcean to $175.00 and gave the stock a “neutral” rating in a report on Tuesday, May 12th. Canaccord Genuity Group restated a “buy” rating and issued a $200.00 price target on shares of DigitalOcean in a research report on Thursday, June 11th. Piper Sandler upped their price target on DigitalOcean from $98.00 to $155.00 and gave the company a “neutral” rating in a report on Tuesday, May 5th. Finally, Weiss Ratings reiterated a “hold (c+)” rating on shares of DigitalOcean in a research report on Wednesday, June 24th. One research analyst has rated the stock with a Strong Buy rating, nine have assigned a Buy rating and three have assigned a Hold rating to the stock. According to MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $146.36.

DigitalOcean Price Performance

The stock’s fifty day moving average price is $153.09 and its 200-day moving average price is $96.29. 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 firm has a market cap of $14.60 billion, a price-to-earnings ratio of 61.11 and a beta of 1.57.

DigitalOcean (NYSE:DOCN) last posted its quarterly earnings data on Tuesday, May 5th. The company reported $0.44 EPS for the quarter, topping analysts’ consensus estimates of $0.27 by $0.17. DigitalOcean had a net margin of 24.97% and a return on equity of 88.86%. The firm had revenue of $257.90 million during the quarter, compared to analyst estimates of $249.76 million. During the same quarter last year, the business posted $0.56 EPS. The company’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. Equities research analysts predict that DigitalOcean Holdings, Inc. will post 0.54 EPS for the current fiscal year.

Insiders Place Their Bets

In related news, 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 transaction, the director directly owned 24,323 shares of the company’s stock, valued at approximately $3,803,630.74. The trade was a 15.14% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CFO Matt Steinfort sold 10,000 shares of the stock in a transaction dated Tuesday, June 2nd. The stock was sold at an average price of $170.07, for a total value of $1,700,700.00. Following the completion of the sale, the chief financial officer directly owned 538,414 shares of the company’s stock, valued at approximately $91,568,068.98. This represents a 1.82% 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. Insiders sold 39,338 shares of company stock valued at $6,191,576 in the last 90 days. Corporate insiders own 0.96% of the company’s stock.

Hedge Funds Weigh In On DigitalOcean

Institutional investors and hedge funds have recently bought and sold shares of the business. Principal Financial Group Inc. increased its holdings in shares of 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 purchasing an additional 674,231 shares during the period. Alyeska Investment Group L.P. acquired a new stake in shares of DigitalOcean during the third quarter worth approximately $21,808,000. Arrowstreet Capital Limited Partnership grew its position in DigitalOcean by 90.9% during 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 in the last quarter. Franklin Resources Inc. grew its position in DigitalOcean by 784.2% during 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 in the last quarter. Finally, Danske Bank A S acquired a new position in DigitalOcean in the 3rd quarter valued at approximately $14,582,000. Hedge funds and other institutional investors own 49.77% of the company’s stock.

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.