DigitalOcean (NYSE:DOCN) Stock Price Down 9.4% – Here’s What Happened

DigitalOcean Holdings, Inc. (NYSE:DOCN) dropped 9.4% during trading on Friday. The company traded as low as $89.02 and last traded at $90.5450. 250,551 shares changed hands during mid-day trading, a decline of 93% from the average session volume of 3,479,230 shares. The stock had previously closed at $99.97.

Wall Street Analysts Forecast Growth

Several equities research analysts have recently commented on the company. Barclays upped their price target on DigitalOcean from $160.00 to $161.00 and gave the stock an “overweight” rating in a research note on Wednesday, August 5th. William Blair restated an “outperform” rating on shares of DigitalOcean in a report on Wednesday, July 15th. Oppenheimer increased their price target on 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 set an “outperform” rating and a $165.00 price objective for the company. Finally, Zacks Research raised DigitalOcean from a “hold” rating to a “strong-buy” rating in a research note on Monday, October 19th. Two analysts have rated the stock with a Strong Buy rating, fourteen have assigned a Buy rating and two have issued a Hold rating to the company. According to data from MarketBeat, the company presently has an average rating of “Buy” and a consensus target price of $150.69.

DigitalOcean Trading Down 12.6%

The business’s 50 day moving average price is $120.27 and its 200-day moving average price is $110.79. The company has a market cap of $9.12 billion, a price-to-earnings ratio of 39.91, a PEG ratio of 91.60 and a beta of 1.70. 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 issued its earnings results on Tuesday, August 4th. The company reported $0.45 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.26 by $0.19. The business had revenue of $281.18 million during the quarter, compared to analysts’ expectations of $279.03 million. DigitalOcean had a return on equity of 31.01% and a net margin of 23.26%. The business’s revenue for the quarter was up 28.6% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $0.39 EPS. DigitalOcean has set its FY 2026 guidance at 1.350-1.400 EPS and its Q3 2026 guidance at 0.280-0.300 EPS. On average, equities analysts anticipate that DigitalOcean Holdings, Inc. will post 0.62 EPS for the current fiscal year.

Insider Buying and Selling

In other DigitalOcean news, Director Warren J. Adelman sold 4,200 shares of the firm’s stock in a transaction dated Friday, August 7th. The stock was sold at an average price of $124.01, for a total transaction of $520,842.00. Following the sale, the director owned 67,433 shares in the company, valued at $8,362,366.33. This trade represents a 5.86% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CAO Cherie Barrett sold 3,985 shares of the firm’s stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $105.73, for a total value of $421,334.05. Following the transaction, the chief accounting officer owned 58,399 shares in the company, valued at approximately $6,174,526.27. The trade was a 6.39% 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. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 22,641 shares of company stock valued at $2,589,317. 0.96% of the stock is owned by company insiders.

Institutional Investors Weigh In On DigitalOcean

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Bank of America Corp DE bought a new stake in shares of DigitalOcean in the second quarter worth about $241,945,000. First Trust Advisors LP grew its position in shares of DigitalOcean by 9.3% in the 1st quarter. First Trust Advisors LP now owns 1,441,151 shares of the company’s stock worth $123,622,000 after buying an additional 122,675 shares during the last quarter. Bank of New York Mellon Corp bought a new stake in shares of DigitalOcean in the 2nd quarter worth approximately $98,011,000. Principal Financial Group Inc. raised its holdings in shares of DigitalOcean by 155.3% during the first quarter. Principal Financial Group Inc. now owns 1,108,420 shares of the company’s stock valued at $95,080,000 after acquiring an additional 674,231 shares in the last quarter. Finally, Allspring Global Investments Holdings LLC raised its holdings in shares of DigitalOcean by 81.3% during the first quarter. Allspring Global Investments Holdings LLC now owns 683,707 shares of the company’s stock valued at $59,947,000 after acquiring an additional 306,529 shares in the last quarter. 49.77% of the stock is currently owned by institutional investors.

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.