Wall Street Zen Upgrades DigitalOcean (NYSE:DOCN) to Buy

DigitalOcean (NYSE:DOCN) was upgraded by analysts at Wall Street Zen from a “hold” rating to a “buy” rating in a research note issued to investors on Saturday.

Several other research firms have also recently weighed in on DOCN. Bank of America upgraded shares of DigitalOcean from an “underperform” rating to a “buy” rating and boosted their price objective for the stock from $34.00 to $60.00 in a research report on Thursday, November 6th. Barclays boosted their target price on DigitalOcean from $40.00 to $49.00 and gave the stock an “overweight” rating in a research report on Thursday, November 6th. UBS Group raised their price target on DigitalOcean from $40.00 to $48.00 and gave the company a “neutral” rating in a report on Thursday, November 6th. Cantor Fitzgerald set a $47.00 price objective on DigitalOcean and gave the stock a “neutral” rating in a report on Thursday, November 6th. Finally, Canaccord Genuity Group upped their target price on shares of DigitalOcean from $55.00 to $60.00 and gave the company a “buy” rating in a research report on Thursday, November 6th. Eight investment analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, DigitalOcean has a consensus rating of “Moderate Buy” and a consensus price target of $48.75.

DigitalOcean Stock Up 0.8%

DigitalOcean stock opened at $49.56 on Friday. The stock has a 50-day simple moving average of $45.12 and a 200 day simple moving average of $36.77. The stock has a market capitalization of $4.53 billion, a price-to-earnings ratio of 19.98, a P/E/G ratio of 6.22 and a beta of 1.77. DigitalOcean has a 12-month low of $25.45 and a 12-month high of $52.20.

DigitalOcean (NYSE:DOCN) last issued its quarterly earnings data on Wednesday, November 5th. The company reported $0.54 EPS for the quarter, topping analysts’ consensus estimates of $0.31 by $0.23. DigitalOcean had a net margin of 29.15% and a negative return on equity of 92.51%. The firm had revenue of $229.63 million for the quarter, compared to analyst estimates of $226.55 million. During the same quarter in the prior year, the firm earned $0.52 EPS. The company’s revenue was up 15.9% on a year-over-year basis. 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 anticipate that DigitalOcean will post 1.01 EPS for the current year.

Hedge Funds Weigh In On DigitalOcean

Several institutional investors and hedge funds have recently made changes to their positions in DOCN. Northern Trust Corp raised its stake in DigitalOcean by 0.4% during the 1st quarter. Northern Trust Corp now owns 728,567 shares of the company’s stock worth $24,327,000 after buying an additional 2,607 shares during the period. Comerica Bank increased its holdings in shares of DigitalOcean by 77.3% in the first quarter. Comerica Bank now owns 116,461 shares of the company’s stock worth $3,889,000 after acquiring an additional 50,762 shares in the last quarter. Trexquant Investment LP acquired a new stake in shares of DigitalOcean during the first quarter worth about $1,041,000. Graham Capital Management L.P. lifted its holdings in shares of DigitalOcean by 284.0% during the 1st quarter. Graham Capital Management L.P. now owns 39,294 shares of the company’s stock valued at $1,312,000 after purchasing an additional 29,061 shares in the last quarter. Finally, Advisors Asset Management Inc. grew its position in shares of DigitalOcean by 39.6% in the 1st quarter. Advisors Asset Management Inc. now owns 2,229 shares of the company’s stock valued at $74,000 after purchasing an additional 632 shares during the period. Institutional investors and hedge funds own 49.77% of the company’s stock.

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.