DigitalOcean (NYSE:DOCN) Shares Down 7.2% – Time to Sell?

Shares of DigitalOcean Holdings, Inc. (NYSE:DOCN) dropped 7.2% during trading on Monday . The stock traded as low as $159.72 and last traded at $160.7180. 894,834 shares changed hands during trading, a decline of 77% from the average session volume of 3,829,418 shares. The stock had previously closed at $173.27.

Wall Street Analyst Weigh In

A number of brokerages have issued reports on DOCN. Barclays lifted their target price on shares of DigitalOcean from $105.00 to $183.00 and gave the company an “overweight” rating in a research note on Wednesday, May 6th. Cantor Fitzgerald increased their price objective on DigitalOcean from $68.00 to $83.00 and gave the stock an “overweight” rating in a report on Wednesday, February 25th. Piper Sandler lifted their price objective on DigitalOcean from $98.00 to $155.00 and gave the company a “neutral” rating in a research report on Tuesday, May 5th. Morgan Stanley upped their target price on DigitalOcean from $75.00 to $175.00 and gave the stock an “overweight” rating in a research report on Wednesday, May 6th. Finally, The Goldman Sachs Group raised their price target on DigitalOcean from $78.00 to $179.00 and gave the stock a “buy” rating in a research note on Wednesday, May 6th. One analyst has rated the stock with a Strong Buy rating, nine have assigned a Buy rating and three have issued a Hold rating to the stock. According to data from MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and a consensus price target of $146.36.

DigitalOcean Price Performance

The company’s 50-day simple moving average is $143.23 and its 200 day simple moving average is $90.36. The company has a quick ratio of 1.46, a current ratio of 1.46 and a debt-to-equity ratio of 0.92. The stock has a market capitalization of $16.25 billion, a price-to-earnings ratio of 68.09 and a beta of 1.59.

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

Insider Activity

In other news, Director Hilary Schneider sold 4,338 shares of the firm’s stock in a transaction on Friday, May 15th. The shares were sold at an average price of $156.38, for a total value of $678,376.44. Following the sale, 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 ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. Also, CFO Matt Steinfort sold 25,000 shares of the business’s stock in a transaction on Friday, May 15th. The stock was sold at an average price of $152.50, for a total transaction of $3,812,500.00. Following the transaction, the chief financial officer directly owned 573,272 shares in the company, valued at $87,423,980. This trade represents a 4.18% 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 valued at $6,191,576 in the last three months. 0.96% of the stock is owned by insiders.

Institutional Investors Weigh In On DigitalOcean

A number of institutional investors have recently added to or reduced their stakes in DOCN. Bullseye Asset Management LLC increased its stake in shares of DigitalOcean by 267.8% in the 3rd quarter. Bullseye Asset Management LLC now owns 99,300 shares of the company’s stock valued at $3,392,000 after buying an additional 72,300 shares during the period. State of New Jersey Common Pension Fund D acquired a new position in DigitalOcean during the fourth quarter valued at approximately $2,358,000. New York State Teachers Retirement System increased its stake in DigitalOcean by 33.0% in the fourth quarter. New York State Teachers Retirement System now owns 49,310 shares of the company’s stock valued at $2,373,000 after purchasing an additional 12,229 shares in the last quarter. Segall Bryant & Hamill LLC bought a new stake in DigitalOcean in the third quarter valued at approximately $8,951,000. Finally, SG Americas Securities LLC raised its holdings in DigitalOcean by 266.1% in the fourth quarter. SG Americas Securities LLC now owns 167,126 shares of the company’s stock worth $8,042,000 after purchasing an additional 121,473 shares during the period. 49.77% of the stock is 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.