DigitalOcean (NYSE:DOCN) Stock Price Expected to Rise, UBS Group Analyst Says

DigitalOcean (NYSE:DOCN) had its price target raised by stock analysts at UBS Group from $48.00 to $68.00 in a report released on Wednesday,Benzinga reports. The brokerage presently has a “neutral” rating on the stock. UBS Group’s price target would indicate a potential upside of 13.11% from the stock’s previous close.

A number of other research analysts have also commented on the company. Weiss Ratings reaffirmed a “hold (c+)” rating on shares of DigitalOcean in a research report on Monday, December 29th. Barclays raised their price target on DigitalOcean from $63.00 to $69.00 and gave the stock an “overweight” rating in a research note on Wednesday. Wall Street Zen downgraded shares of DigitalOcean from a “buy” rating to a “hold” rating in a research report on Sunday, January 4th. Royal Bank Of Canada set a $60.00 target price on shares of DigitalOcean in a research report on Tuesday. Finally, Piper Sandler reaffirmed a “neutral” rating and set a $67.00 target price on shares of DigitalOcean in a research note on Tuesday. Nine analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. According to data from MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and a consensus price target of $67.50.

DigitalOcean Trading Down 4.2%

Shares of DOCN stock traded down $2.62 during mid-day trading on Wednesday, reaching $60.12. The stock had a trading volume of 3,558,542 shares, compared to its average volume of 3,218,006. The firm has a market capitalization of $5.50 billion, a PE ratio of 24.18, a price-to-earnings-growth ratio of 8.32 and a beta of 1.76. The stock’s 50-day moving average price is $55.78 and its two-hundred day moving average price is $45.13. DigitalOcean has a 52-week low of $25.45 and a 52-week high of $70.43.

Institutional Investors Weigh In On DigitalOcean

Institutional investors have recently modified their holdings of the stock. Allworth Financial LP raised its position in shares of DigitalOcean by 54.4% in the 3rd quarter. Allworth Financial LP now owns 724 shares of the company’s stock worth $25,000 after purchasing an additional 255 shares during the last quarter. Huntington National Bank raised its holdings in DigitalOcean by 638.3% in the fourth quarter. Huntington National Bank now owns 598 shares of the company’s stock worth $29,000 after buying an additional 517 shares during the last quarter. NBC Securities Inc. bought a new position in shares of DigitalOcean in the fourth quarter worth approximately $32,000. Wilmington Savings Fund Society FSB purchased a new stake in shares of DigitalOcean during the third quarter valued at approximately $37,000. Finally, Transamerica Financial Advisors LLC increased its position in shares of DigitalOcean by 417.9% during the fourth quarter. Transamerica Financial Advisors LLC now owns 782 shares of the company’s stock valued at $38,000 after acquiring an additional 631 shares in the last quarter. 49.77% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting DigitalOcean

Here are the key news stories impacting DigitalOcean this week:

• Positive Sentiment: Q4 beat and AI traction — DOCN reported Q4 revenue and EPS above expectations and disclosed AI-specific ARR of about $120M (150% YoY growth), evidence that its “Agentic Inference Cloud” is attracting larger, stickier customers. DigitalOcean’s AI Surge: The Cloud Underdog Swims Upstream
• Positive Sentiment: Analyst bullishness — Multiple firms raised price targets and ratings (examples: BofA to $86, Oppenheimer $85, Goldman $78, Cantor/Citizens/JMP in the $69–$83 range), reflecting expectation of upside from AI-driven growth. Analyst Coverage / Benzinga
• Positive Sentiment: Platform, not just GPU rental — Management says ~70% of AI revenue is platform services (inference, storage, networking) rather than raw GPU capacity, implying more recurring, higher-margin revenue and low churn among large customers. MarketBeat: AI Surge
• Neutral Sentiment: Strategic hardware move — DigitalOcean announced AMD Instinct MI350X GPU deployments to diversify supply and improve price-performance vs. NVIDIA-only builds; this supports capacity growth but is an execution item to watch. DigitalOcean Expands AMD AI Cloud
• Neutral Sentiment: Profitability profile — DOCN remains profitable with strong EBITDA margins (management cites ~40% adjusted EBITDA in 2025), supporting valuation as a mid-cap cloud play while it scales AI offerings. Seeking Alpha: Durable Rally
• Negative Sentiment: Forward EPS guidance disappointed — Management issued FY26 and Q1 EPS ranges materially below Street consensus, flagging margin and per-share dilution from planned capex and capacity builds; this appears to be the primary reason some traders pulled back after the initial rally. Q4 Results – Earnings Presentation
• Negative Sentiment: Near-term cash-flow pressure — Management expects lower free-cash-flow margins in 2026 (higher capex to add capacity), which can compress near-term FCF and make the stock more sensitive to execution on demand and buildouts. BusinessWire: Q4 & FY2025 Results

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.