DigitalOcean (NYSE:DOCN) Cut to “Hold” at Wall Street Zen

Wall Street Zen cut shares of DigitalOcean (NYSE:DOCN) from a buy rating to a hold rating in a research report report published on Sunday morning.

Several other brokerages have also commented on DOCN. Weiss Ratings restated a “hold (c+)” rating on shares of DigitalOcean in a research note on Monday, December 29th. UBS Group lifted their target price on shares of 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 target on shares of DigitalOcean and gave the stock a “neutral” rating in a research report on Thursday, November 6th. Barclays upped 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. Finally, Canaccord Genuity Group raised their target price on DigitalOcean from $55.00 to $60.00 and gave the company a “buy” rating in a report on Thursday, November 6th. Eight equities research analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the stock. Based on data from MarketBeat.com, DigitalOcean currently has an average rating of “Moderate Buy” and a consensus target price of $48.85.

DigitalOcean Trading Up 6.7%

Shares of NYSE:DOCN opened at $54.00 on Friday. The firm has a market cap of $4.94 billion, a price-to-earnings ratio of 21.77, a PEG ratio of 7.27 and a beta of 1.76. The stock’s 50-day moving average price is $46.50 and its two-hundred day moving average price is $37.85. DigitalOcean has a 12-month low of $25.45 and a 12-month high of $54.41.

DigitalOcean (NYSE:DOCN) last announced its quarterly earnings data on Wednesday, November 5th. The company reported $0.54 earnings per share for the quarter, topping 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 firm posted $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, research analysts forecast that DigitalOcean will post 1.01 earnings per share for the current fiscal year.

Hedge Funds Weigh In On DigitalOcean

A number of hedge funds have recently bought and sold shares of the company. Penserra Capital Management LLC bought a new stake in DigitalOcean during the 2nd quarter valued at $6,580,000. Allspring Global Investments Holdings LLC raised its stake in shares of DigitalOcean by 25.5% during the second quarter. Allspring Global Investments Holdings LLC now owns 215,483 shares of the company’s stock valued at $6,038,000 after purchasing an additional 43,732 shares in the last quarter. Trexquant Investment LP bought a new stake in shares of DigitalOcean during the first quarter valued at about $1,041,000. Jennison Associates LLC acquired a new stake in DigitalOcean in the second quarter worth about $455,000. Finally, Cherry Creek Investment Advisors Inc. grew its position in DigitalOcean by 18.7% in the 2nd quarter. Cherry Creek Investment Advisors Inc. now owns 45,831 shares of the company’s stock valued at $1,309,000 after buying an additional 7,228 shares in the last quarter. 49.77% of the stock is currently owned by institutional investors and hedge funds.

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.