DigitalOcean (NYSE:DOCN) Shares Down 7% – Here’s What Happened

Shares of DigitalOcean Holdings, Inc. (NYSE:DOCN) fell 7% on Wednesday . The stock traded as low as $138.15 and last traded at $146.0840. Approximately 1,193,785 shares traded hands during mid-day trading, a decline of 69% from the average session volume of 3,897,549 shares. The stock had previously closed at $157.03.

Wall Street Analysts Forecast Growth

Several brokerages have commented on DOCN. UBS Group raised their price objective on DigitalOcean to $175.00 and gave the company a “neutral” rating in a research report on Tuesday, May 12th. Citizens Jmp upped their target price on shares of DigitalOcean from $83.00 to $105.00 and gave the stock a “market outperform” rating in a research report on Thursday, March 26th. The Goldman Sachs Group increased their price target on shares of DigitalOcean from $78.00 to $179.00 and gave the stock a “buy” rating in a research note on Wednesday, May 6th. Canaccord Genuity Group reissued a “buy” rating and set a $200.00 price target on shares of DigitalOcean in a research report on Thursday, June 11th. Finally, Piper Sandler boosted their price objective on shares of DigitalOcean from $98.00 to $155.00 and gave the stock a “neutral” rating in a research note on Tuesday, May 5th. One research analyst has rated the stock with a Strong Buy rating, nine have given a Buy rating and three have assigned a Hold rating to the company’s stock. According to data from MarketBeat.com, the company has an average rating of “Moderate Buy” and a consensus price target of $146.36.

DigitalOcean Stock Down 9.5%

The company’s 50-day moving average is $149.90 and its 200 day moving average is $93.84. The company has a debt-to-equity ratio of 0.92, a quick ratio of 1.46 and a current ratio of 1.46. The company has a market capitalization of $14.83 billion, a PE ratio of 62.29 and a beta of 1.60.

DigitalOcean (NYSE:DOCN) last announced its quarterly earnings results on Tuesday, May 5th. The company reported $0.44 earnings per share for the quarter, beating the consensus estimate of $0.27 by $0.17. The company had revenue of $257.90 million during the quarter, compared to the consensus estimate of $249.76 million. DigitalOcean had a net margin of 24.97% and a return on equity of 88.86%. The firm’s quarterly revenue was up 22.4% compared to the same quarter last year. During the same quarter last year, the firm earned $0.56 earnings per share. DigitalOcean has set its Q2 2026 guidance at 0.200-0.230 EPS and its FY 2026 guidance at 1.100-1.200 EPS. As a group, analysts anticipate that DigitalOcean Holdings, Inc. will post 0.54 EPS for the current year.

Insider Activity

In other news, CFO Matt Steinfort sold 25,000 shares of the business’s stock in a transaction that occurred on Friday, May 15th. The shares were sold at an average price of $152.50, for a total transaction of $3,812,500.00. Following the completion of the transaction, the chief financial officer directly owned 573,272 shares of the company’s stock, valued at $87,423,980. The trade was a 4.18% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Hilary Schneider sold 4,338 shares of the stock in a transaction that occurred on Friday, May 15th. The shares were sold at an average price of $156.38, for a total transaction of $678,376.44. Following the transaction, the director owned 24,323 shares in the company, valued at approximately $3,803,630.74. This trade represents a 15.14% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 39,338 shares of company stock worth $6,191,576 in the last 90 days. Company insiders own 0.96% of the company’s stock.

Institutional Investors Weigh In On DigitalOcean

A number of hedge funds have recently added to or reduced their stakes in the stock. Pacer Advisors Inc. boosted its stake in shares of DigitalOcean by 18.0% in the 1st quarter. Pacer Advisors Inc. now owns 19,383 shares of the company’s stock worth $1,663,000 after buying an additional 2,957 shares during the last quarter. Wealth High Governance Capital Ltda purchased a new stake in DigitalOcean during the first quarter valued at $10,519,000. Wealth High Governance Asset Management Ltda. purchased a new stake in DigitalOcean during the first quarter valued at $8,986,000. Parallel Advisors LLC lifted its holdings 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 period. Finally, Optiver Holding B.V. lifted its holdings in DigitalOcean by 1,063.9% in the first quarter. Optiver Holding B.V. now owns 419 shares of the company’s stock valued at $36,000 after acquiring an additional 383 shares during the period. 49.77% of the stock is currently owned by hedge funds and other institutional investors.

DigitalOcean Company Profile

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.