DigitalOcean (NYSE:DOCN) Shares Gap Up – Here’s Why

Shares of DigitalOcean Holdings, Inc. (NYSE:DOCN) gapped up before the market opened on Friday. The stock had previously closed at $70.70, but opened at $78.40. DigitalOcean shares last traded at $73.6020, with a volume of 600,112 shares traded.

Analyst Ratings Changes

A number of research analysts have commented on DOCN shares. Piper Sandler upgraded DigitalOcean from a “neutral” rating to an “overweight” rating and decreased their price target for the stock from $142.00 to $126.00 in a research note on Wednesday, October 21st. UBS Group dropped their price objective on shares of DigitalOcean from $105.00 to $100.00 and set a “neutral” rating on the stock in a research report on Wednesday. KeyCorp restated an “overweight” rating on shares of DigitalOcean in a research note on Tuesday, October 13th. Zacks Research raised DigitalOcean from a “hold” rating to a “strong-buy” rating in a report on Monday, October 19th. Finally, Weiss Ratings cut DigitalOcean from a “hold (c+)” rating to a “sell (d+)” rating in a research report on Wednesday. Two investment analysts have rated the stock with a Strong Buy rating, fourteen have assigned a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, DigitalOcean currently has a consensus rating of “Moderate Buy” and a consensus price target of $141.06.

DigitalOcean Price Performance

The company has a market cap of $7.62 billion, a PE ratio of 234.72, a price-to-earnings-growth ratio of 73.25 and a beta of 1.69. The stock has a fifty day simple moving average of $117.35 and a two-hundred day simple moving average of $111.57. The company has a current ratio of 1.15, a quick ratio of 1.31 and a debt-to-equity ratio of 0.61.

DigitalOcean (NYSE:DOCN) last posted its quarterly earnings results on Tuesday, November 3rd. The company reported $0.45 EPS for the quarter, beating the consensus estimate of $0.32 by $0.13. DigitalOcean had a return on equity of 15.01% and a net margin of 3.11%. The business had revenue of $321.19 million during the quarter, compared to analysts’ expectations of $306.74 million. During the same period last year, the firm earned $0.54 EPS. The company’s quarterly revenue was up 39.6% compared to the same quarter last year. On average, equities analysts predict that DigitalOcean Holdings, Inc. will post 0.62 EPS for the current fiscal year.

Insider Buying and Selling at DigitalOcean

In other DigitalOcean news, CFO Matt Steinfort sold 10,000 shares of the stock in a transaction 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 sale, the chief financial officer owned 503,692 shares in the company, valued at approximately $53,255,355.16. This represents a 1.95% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through 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 3,985 shares of the stock in a transaction on Thursday, September 3rd. The shares were sold at an average price of $105.73, for a total value of $421,334.05. Following the sale, the chief accounting officer directly owned 58,399 shares in the company, valued at approximately $6,174,526.27. The trade was a 6.39% decrease in their position. The disclosure for this sale is available in the SEC filing. 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. Insiders sold 18,441 shares of company stock worth $2,068,475 in the last three months. 0.96% of the stock is owned by corporate insiders.

Institutional Trading of DigitalOcean

Hedge funds have recently bought and sold shares of the company. EverSource Wealth Advisors LLC boosted its holdings in shares of DigitalOcean by 14.8% during the first quarter. EverSource Wealth Advisors LLC now owns 551 shares of the company’s stock worth $47,000 after purchasing an additional 71 shares during the last quarter. Sigma Planning Corp increased its position in DigitalOcean by 7.7% during the 3rd quarter. Sigma Planning Corp now owns 1,586 shares of the company’s stock worth $212,000 after purchasing an additional 114 shares in the last quarter. Parallel Advisors LLC increased its position in shares of DigitalOcean by 66.2% in the first quarter. Parallel Advisors LLC now owns 324 shares of the company’s stock worth $28,000 after acquiring an additional 129 shares in the last quarter. Signaturefd LLC increased its holdings in DigitalOcean by 16.9% in the 3rd quarter. Signaturefd LLC now owns 918 shares of the company’s stock valued at $122,000 after purchasing an additional 133 shares in the last quarter. Finally, Focus Financial Network Inc. raised its holdings in shares of DigitalOcean by 10.0% during the 3rd quarter. Focus Financial Network Inc. now owns 1,589 shares of the company’s stock valued at $212,000 after buying an additional 145 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 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.