DigitalOcean (NYSE:DOCN) Trading 7% Higher – Here’s Why

DigitalOcean Holdings, Inc. (NYSE:DOCN)’s stock price rose 7% on Monday . The stock traded as high as $59.17 and last traded at $59.10. Approximately 616,271 shares traded hands during trading, a decline of 77% from the average daily volume of 2,711,473 shares. The stock had previously closed at $55.25.

Wall Street Analysts Forecast Growth

Several equities analysts have commented on DOCN shares. Weiss Ratings reaffirmed a “hold (c+)” rating on shares of DigitalOcean in a report on Monday, December 29th. Piper Sandler upped their target price on shares of DigitalOcean from $47.00 to $50.00 and gave the company a “neutral” rating in a research note on Monday, January 5th. UBS Group lifted their price objective on DigitalOcean from $40.00 to $48.00 and gave the company a “neutral” rating in a report on Thursday, November 6th. Wall Street Zen cut DigitalOcean from a “buy” rating to a “hold” rating in a report on Sunday, January 4th. Finally, Oppenheimer began coverage on DigitalOcean in a research note on Monday, November 10th. They issued an “outperform” rating and a $60.00 price target on the stock. Seven research analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $50.50.

DigitalOcean Stock Up 8.1%

The company has a market cap of $5.47 billion, a P/E ratio of 24.14, a P/E/G ratio of 7.93 and a beta of 1.76. The business has a 50-day moving average price of $50.06 and a two-hundred day moving average price of $41.13.

DigitalOcean (NYSE:DOCN) last announced its quarterly earnings data on Wednesday, November 5th. The company reported $0.54 earnings per share for the quarter, beating the consensus estimate of $0.31 by $0.23. DigitalOcean had a net margin of 29.15% and a negative return on equity of 92.51%. The business had revenue of $229.63 million for the quarter, compared to analyst estimates of $226.55 million. During the same period in the prior year, the business posted $0.52 earnings per share. DigitalOcean’s revenue was up 15.9% compared to the same quarter last year. DigitalOcean has set its Q4 2025 guidance at 0.350-0.400 EPS and its FY 2025 guidance at 2.000-2.050 EPS. As a group, sell-side analysts expect that DigitalOcean Holdings, Inc. will post 1.01 EPS for the current fiscal year.

Hedge Funds Weigh In On DigitalOcean

Several institutional investors and hedge funds have recently made changes to their positions in DOCN. Allworth Financial LP increased its position 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 buying an additional 255 shares in the last quarter. NBC Securities Inc. acquired a new position in DigitalOcean in the fourth quarter valued at about $32,000. Wilmington Savings Fund Society FSB bought a new stake in shares of DigitalOcean in the third quarter worth about $37,000. Advisory Services Network LLC acquired a new stake in shares of DigitalOcean during the third quarter worth about $54,000. Finally, Farther Finance Advisors LLC lifted its holdings in shares of DigitalOcean by 42.3% during the 2nd quarter. Farther Finance Advisors LLC now owns 1,924 shares of the company’s stock valued at $55,000 after purchasing an additional 572 shares in the last quarter. Institutional investors and hedge funds 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.