DigitalOcean (NYSE:DOCN) Trading Up 11.7% – Should You Buy?

DigitalOcean Holdings, Inc. (NYSE:DOCN) traded up 11.7% during trading on Tuesday . The company traded as high as $122.67 and last traded at $125.5880. Approximately 928,965 shares changed hands during mid-day trading, a decline of 75% from the average session volume of 3,648,335 shares. The stock had previously closed at $112.47.

Analysts Set New Price Targets

DOCN has been the topic of several analyst reports. Canaccord Genuity Group reiterated a “buy” rating and issued a $200.00 target price on shares of DigitalOcean in a report on Friday, July 10th. Truist Financial started coverage on shares of DigitalOcean in a research note on Thursday, August 27th. They set a “buy” rating and a $175.00 target price for the company. UBS Group cut their price target on shares of DigitalOcean from $155.00 to $140.00 and set a “neutral” rating on the stock in a research report on Wednesday, August 5th. Barclays increased their price target on DigitalOcean from $160.00 to $161.00 and gave the stock an “overweight” rating in a report on Wednesday, August 5th. Finally, Citigroup upped their target price on DigitalOcean from $185.00 to $190.00 and gave the company a “buy” rating in a research report on Wednesday, August 5th. Two equities research analysts have rated the stock with a Strong Buy rating, thirteen have issued a Buy rating and two have issued a Hold rating to the company. According to MarketBeat.com, the stock has an average rating of “Buy” and an average price target of $152.81.

DigitalOcean Trading Up 14.6%

The firm has a market cap of $13.45 billion, a price-to-earnings ratio of 58.75, a P/E/G ratio of 96.28 and a beta of 1.57. The firm’s 50-day moving average is $123.78 and its 200-day moving average is $117.63. The company has a current ratio of 1.31, a quick ratio of 1.31 and a debt-to-equity ratio of 1.14.

DigitalOcean (NYSE:DOCN) last released its quarterly earnings data on Tuesday, August 4th. The company reported $0.45 earnings per share for the quarter, topping the consensus estimate of $0.26 by $0.19. The firm had revenue of $281.18 million for the quarter, compared to the consensus estimate of $279.03 million. DigitalOcean had a net margin of 23.26% and a return on equity of 31.01%. The business’s revenue was up 28.6% on a year-over-year basis. During the same quarter in the prior year, the company posted $0.39 earnings per share. DigitalOcean has set its FY 2026 guidance at 1.350-1.400 EPS and its Q3 2026 guidance at 0.280-0.300 EPS. As a group, sell-side analysts anticipate that DigitalOcean Holdings, Inc. will post 0.63 EPS for the current fiscal year.

Insider Buying and Selling at DigitalOcean

In related news, CFO Matt Steinfort sold 10,000 shares of DigitalOcean stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $105.73, for a total transaction of $1,057,300.00. Following the transaction, the chief financial officer owned 503,692 shares of the company’s stock, valued at $53,255,355.16. The trade was a 1.95% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. 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, 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 sale, the chief accounting officer directly owned 65,487 shares of the company’s stock, valued at $8,668,514.19. The trade was a 6.37% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 22,641 shares of company stock worth $2,589,317. Insiders own 0.96% of the company’s stock.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in DOCN. Hilltop National Bank purchased a new position in DigitalOcean during the second quarter worth about $38,000. Rakuten Securities Inc. bought a new position in shares of DigitalOcean in the second quarter valued at approximately $43,000. Parallel Advisors LLC increased its position in shares of DigitalOcean by 66.2% during the first 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. Banque Cantonale Vaudoise purchased a new position in DigitalOcean in the first quarter worth $33,000. Finally, LRI Investments LLC bought a new position in DigitalOcean in the 2nd quarter valued at $64,000. 49.77% of the stock is owned by institutional investors.

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.