DigitalOcean (NYSE:DOCN) Trading Down 7.9% – Should You Sell?

DigitalOcean Holdings, Inc. (NYSE:DOCN) traded down 7.9% on Friday . The stock traded as low as $111.89 and last traded at $112.02. Approximately 697,734 shares were traded during trading, a decline of 81% from the average session volume of 3,709,936 shares. The stock had previously closed at $121.68.

Analyst Upgrades and Downgrades

DOCN has been the topic of a number of research analyst reports. The Goldman Sachs Group increased their price target on DigitalOcean from $78.00 to $179.00 and gave the stock a “buy” rating in a research report on Wednesday, May 6th. Weiss Ratings upgraded DigitalOcean from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Tuesday, August 11th. KeyCorp initiated coverage on DigitalOcean in a research note on Tuesday, June 2nd. They issued an “overweight” rating and a $200.00 price objective on the stock. William Blair restated an “outperform” rating on shares of DigitalOcean in a report on Wednesday, July 15th. Finally, Canaccord Genuity Group reaffirmed a “buy” rating and issued a $200.00 price target on shares of DigitalOcean in a report on Friday, July 10th. Two investment analysts have rated the stock with a Strong Buy rating, thirteen have given a Buy rating and two have given a Hold rating to the company. According to MarketBeat, the stock has a consensus rating of “Buy” and an average price target of $152.81.

DigitalOcean Trading Down 8.4%

The company has a quick ratio of 1.31, a current ratio of 1.31 and a debt-to-equity ratio of 1.14. The firm has a market cap of $11.64 billion, a price-to-earnings ratio of 50.91, a price-to-earnings-growth ratio of 95.20 and a beta of 1.61. The business’s fifty day moving average is $128.72 and its two-hundred day moving average is $115.41.

DigitalOcean (NYSE:DOCN) last posted 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. DigitalOcean had a net margin of 23.26% and a return on equity of 31.01%. The firm had revenue of $281.18 million during the quarter, compared to analysts’ expectations of $279.03 million. During the same quarter in the previous year, the company posted $0.39 EPS. DigitalOcean’s revenue was up 28.6% on a year-over-year basis. DigitalOcean has set its FY 2026 guidance at 1.350-1.400 EPS and its Q3 2026 guidance at 0.280-0.300 EPS. Equities analysts anticipate that DigitalOcean Holdings, Inc. will post 0.63 earnings per share for the current fiscal year.

Insider Transactions at DigitalOcean

In other news, CAO Cherie Barrett sold 4,456 shares of the company’s stock in a transaction on Thursday, August 13th. The stock was sold at an average price of $132.37, for a total transaction of $589,840.72. Following the transaction, the chief accounting officer owned 65,487 shares of the company’s stock, valued at $8,668,514.19. This represents a 6.37% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Warren J. Adelman sold 4,200 shares of the firm’s stock in a transaction dated Friday, August 7th. The shares were sold at an average price of $124.01, for a total value of $520,842.00. Following the completion of the transaction, the director owned 67,433 shares in the company, valued at approximately $8,362,366.33. This represents a 5.86% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 18,656 shares of company stock worth $2,811,383 over the last 90 days. 0.96% of the stock is owned by insiders.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of DOCN. Hilltop National Bank bought a new stake in shares of DigitalOcean during the second quarter worth approximately $38,000. Rakuten Securities Inc. acquired a new position in DigitalOcean in the second quarter valued at approximately $43,000. Parallel Advisors LLC boosted its stake in DigitalOcean by 66.2% in 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 bought a new position in DigitalOcean in the first quarter valued at approximately $33,000. Finally, LRI Investments LLC acquired a new stake in DigitalOcean during the 2nd quarter worth $64,000. Institutional investors 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.