The Goldman Sachs Group Has Lowered Expectations for DigitalOcean (NYSE:DOCN) Stock Price

DigitalOcean (NYSE:DOCN) had its price target dropped by equities researchers at The Goldman Sachs Group from $178.00 to $156.00 in a research note issued to investors on Thursday, Benzinga reports. The firm presently has a “buy” rating on the stock. The Goldman Sachs Group‘s price target suggests a potential upside of 117.25% from the stock’s current price.

Several other equities research analysts have also recently commented on the company. KeyCorp reissued an “overweight” rating on shares of DigitalOcean in a research note on Tuesday, October 13th. UBS Group cut their price objective on DigitalOcean from $105.00 to $100.00 and set a “neutral” rating for the company in a research report on Wednesday. Oppenheimer increased their price target on shares of DigitalOcean from $190.00 to $220.00 and gave the company an “outperform” rating in a report on Wednesday, October 14th. Robert W. Baird initiated coverage on DigitalOcean in a research report on Tuesday, July 21st. They issued an “outperform” rating and a $165.00 price objective for the company. Finally, Weiss Ratings cut DigitalOcean from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Wednesday, September 9th. Two equities research analysts have rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and two have assigned a Hold rating to the stock. Based on data from MarketBeat.com, DigitalOcean presently has an average rating of “Buy” and a consensus target price of $141.06.

DigitalOcean Stock Down 14.5%

NYSE:DOCN traded down $12.21 during trading hours on Thursday, hitting $71.81. 4,053,159 shares of the company’s stock traded hands, compared to its average volume of 3,549,089. The firm has a market cap of $7.49 billion, a P/E ratio of 230.05, a P/E/G ratio of 78.90 and a beta of 1.69. DigitalOcean has a twelve month low of $41.96 and a twelve month high of $187.50. The company has a debt-to-equity ratio of 0.61, a quick ratio of 1.31 and a current ratio of 1.15. The stock’s fifty day moving average price is $118.24 and its two-hundred day moving average price is $111.48.

DigitalOcean (NYSE:DOCN) last announced its quarterly earnings data on Tuesday, November 3rd. The company reported $0.45 EPS for the quarter, topping analysts’ consensus estimates of $0.32 by $0.13. The firm had revenue of $321.19 million during the quarter, compared to analyst estimates of $306.74 million. DigitalOcean had a return on equity of 15.01% and a net margin of 3.11%. The business’s quarterly revenue was up 39.6% compared to the same quarter last year. During the same period last year, the company posted $0.54 EPS. On average, research analysts expect that DigitalOcean will post 0.62 earnings per share for the current fiscal year.

Insider Buying and Selling at DigitalOcean

In other DigitalOcean news, Director Warren J. Adelman sold 4,200 shares of DigitalOcean stock in a transaction on Friday, August 7th. The shares were sold at an average price of $124.01, for a total transaction of $520,842.00. Following the completion of the sale, the director owned 67,433 shares of the company’s stock, valued at approximately $8,362,366.33. The trade was a 5.86% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, 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 completion of the transaction, the chief accounting officer directly owned 65,487 shares in the company, valued at approximately $8,668,514.19. This trade represents a 6.37% 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. In the last ninety days, insiders have sold 22,641 shares of company stock worth $2,589,317. Insiders own 0.96% of the company’s stock.

Hedge Funds Weigh In On DigitalOcean

Hedge funds have recently added to or reduced their stakes in the stock. Parallel Advisors LLC increased its stake in shares of DigitalOcean by 66.2% in the 1st quarter. Parallel Advisors LLC now owns 324 shares of the company’s stock valued at $28,000 after acquiring an additional 129 shares during the last quarter. Root Financial Partners LLC bought a new position in DigitalOcean during the 3rd quarter worth approximately $31,000. Optiver Holding B.V. boosted its stake in DigitalOcean by 1,063.9% during the 1st quarter. Optiver Holding B.V. now owns 419 shares of the company’s stock worth $36,000 after acquiring an additional 383 shares during the last quarter. SSI Investment Management LLC acquired a new position in DigitalOcean during the second quarter valued at approximately $37,000. Finally, Hilltop National Bank acquired a new position in DigitalOcean during the second quarter valued at approximately $38,000. Institutional investors and hedge funds own 49.77% of the company’s stock.

Key Headlines Impacting DigitalOcean

Here are the key news stories impacting DigitalOcean this week:

• Positive Sentiment: DigitalOcean beat Q3 expectations, reporting $321.2 million in revenue, up 39.6% year over year, and EPS of $0.45 versus the $0.32 consensus. The company also raised its outlook; management expects revenue growth of at least 60% in 2027, with most AI customer revenue coming from existing cloud customers. DigitalOcean Stock Jumps On Higher Guidance And AI Revenue Growth
• Positive Sentiment: A Yahoo Finance article argues DOCN could be 62% below fair value after the results and offering, suggesting potential upside if its valuation view proves correct. DigitalOcean Holdings Could Be 62% Below Fair Value
• Neutral Sentiment: Despite lowering price targets, Canaccord, Citi and Barclays maintained Buy or Overweight ratings; UBS kept a Neutral rating. Their revised targets remain above the recent share price, but the cuts signal more cautious assumptions. UBS Adjusts Price Target
• Negative Sentiment: The reported $1 billion offering may be weighing on sentiment amid concern about added share supply or dilution; the provided article headline does not specify the offering’s terms. Multiple firms also reduced targets, including UBS to $100, Citi to $160, Barclays to $140, Canaccord to $180 and Stifel to $130. Stifel Lowers DigitalOcean Price Target

About DigitalOcean

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.