DigitalOcean (NYSE:DOCN) Hits New 12-Month High – Should You Buy?

DigitalOcean Holdings, Inc. (NYSE:DOCN) shares reached a new 52-week high during trading on Friday . The stock traded as high as $45.50 and last traded at $44.94, with a volume of 394298 shares traded. The stock had previously closed at $43.99.

Analysts Set New Price Targets

Several brokerages have weighed in on DOCN. JPMorgan Chase & Co. raised their price target on DigitalOcean from $32.00 to $40.00 and gave the stock a “neutral” rating in a report on Friday, October 25th. JMP Securities boosted their price target on DigitalOcean from $47.00 to $55.00 and gave the company a “market outperform” rating in a report on Monday, January 27th. Barclays lifted their price target on DigitalOcean from $38.00 to $48.00 and gave the company an “overweight” rating in a research note on Friday, October 11th. Cantor Fitzgerald assumed coverage on DigitalOcean in a report on Friday, January 17th. They issued a “neutral” rating and a $39.00 price objective on the stock. Finally, Citigroup started coverage on DigitalOcean in a research note on Friday, January 24th. They set a “buy” rating and a $45.00 target price for the company. Six investment analysts have rated the stock with a hold rating and six have issued a buy rating to the company. According to MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average target price of $42.73.

DigitalOcean Price Performance

The business has a 50 day simple moving average of $37.45 and a 200 day simple moving average of $37.83. The company has a market capitalization of $4.14 billion, a price-to-earnings ratio of 52.64, a PEG ratio of 3.01 and a beta of 1.81.

DigitalOcean (NYSE:DOCN) last issued its quarterly earnings results on Monday, November 4th. The company reported $0.52 EPS for the quarter, beating the consensus estimate of $0.40 by $0.12. The company had revenue of $198.50 million during the quarter, compared to analysts’ expectations of $196.64 million. DigitalOcean had a net margin of 10.86% and a negative return on equity of 43.11%. The firm’s revenue was up 12.1% compared to the same quarter last year. During the same quarter last year, the company posted $0.17 EPS. On average, equities research analysts predict that DigitalOcean Holdings, Inc. will post 1.01 EPS for the current year.

Insider Buying and Selling

In related news, insider Bratin Saha sold 4,289 shares of the company’s stock in a transaction that occurred on Tuesday, January 21st. The stock was sold at an average price of $36.80, for a total value of $157,835.20. Following the sale, the insider now owns 372,762 shares of the company’s stock, valued at approximately $13,717,641.60. This represents a 1.14 % decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CFO Matt Steinfort sold 12,498 shares of the company’s stock in a transaction on Wednesday, December 4th. The shares were sold at an average price of $40.00, for a total value of $499,920.00. Following the completion of the sale, the chief financial officer now owns 517,498 shares in the company, valued at $20,699,920. This represents a 2.36 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 37,244 shares of company stock valued at $1,416,208 in the last three months. 0.74% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On DigitalOcean

A number of hedge funds and other institutional investors have recently modified their holdings of DOCN. Jacobs Levy Equity Management Inc. raised its holdings in DigitalOcean by 32.8% in the 3rd quarter. Jacobs Levy Equity Management Inc. now owns 1,397,588 shares of the company’s stock valued at $56,449,000 after acquiring an additional 345,119 shares during the last quarter. C2P Capital Advisory Group LLC d.b.a. Prosperity Capital Advisors acquired a new stake in DigitalOcean in the 4th quarter worth about $5,382,000. Bank of New York Mellon Corp increased its stake in shares of DigitalOcean by 19.7% during the 4th quarter. Bank of New York Mellon Corp now owns 791,861 shares of the company’s stock valued at $26,979,000 after acquiring an additional 130,263 shares during the last quarter. Principal Financial Group Inc. lifted its holdings in shares of DigitalOcean by 10.4% during the 3rd quarter. Principal Financial Group Inc. now owns 1,301,499 shares of the company’s stock worth $52,568,000 after acquiring an additional 122,651 shares during the period. Finally, Geode Capital Management LLC boosted its position in shares of DigitalOcean by 7.9% in the third quarter. Geode Capital Management LLC now owns 1,464,333 shares of the company’s stock worth $59,156,000 after acquiring an additional 106,636 shares during the last quarter. 49.77% of the stock is currently owned by hedge funds and other institutional investors.

About DigitalOcean

DigitalOcean Holdings, Inc, through its subsidiaries, operates a cloud computing platform in North America, Europe, Asia, and internationally. The company’s platform provides on-demand infrastructure and platform tools for developers, start-ups, and small and growing digital businesses. It also offers infrastructure-as-a-service (IaaS) solutions comprising compute and storage services, as well as networking projects, including Cloud Firewalls software, Managed Load Balancers software, and Virtual Private Cloud (VPC).