Bank of America Forecasts Strong Price Appreciation for DigitalOcean (NYSE:DOCN) Stock

DigitalOcean (NYSE:DOCN) had its price target raised by equities research analysts at Bank of America from $72.00 to $86.00 in a research note issued on Wednesday,Benzinga reports. The firm currently has a “buy” rating on the stock. Bank of America‘s target price suggests a potential upside of 57.91% from the company’s previous close.

Other equities analysts have also recently issued research reports about the stock. Cantor Fitzgerald upgraded shares of DigitalOcean from a “neutral” rating to an “overweight” rating and lifted their target price for the stock from $47.00 to $68.00 in a research report on Thursday, February 5th. Canaccord Genuity Group lifted their price objective on DigitalOcean from $65.00 to $80.00 and gave the stock a “buy” rating in a research report on Friday, February 20th. Wall Street Zen cut DigitalOcean from a “buy” rating to a “hold” rating in a report on Sunday, January 4th. Weiss Ratings restated a “hold (c+)” rating on shares of DigitalOcean in a research report on Monday, December 29th. Finally, Royal Bank Of Canada set a $60.00 price objective on DigitalOcean in a research note on Tuesday. Nine research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. According to data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average target price of $69.23.

DigitalOcean Stock Down 8.1%

Shares of DOCN stock opened at $54.46 on Wednesday. DigitalOcean has a fifty-two week low of $25.45 and a fifty-two week high of $70.43. The stock has a market cap of $5.01 billion, a P/E ratio of 21.53, a P/E/G ratio of 8.33 and a beta of 1.77. The business has a fifty day simple moving average of $56.26 and a 200-day simple moving average of $45.30.

Institutional Inflows and Outflows

Several hedge funds have recently added to or reduced their stakes in the stock. Huntington National Bank lifted 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 acquiring an additional 517 shares during the last quarter. NBC Securities Inc. bought a new stake in DigitalOcean in the fourth quarter worth about $32,000. Allworth Financial LP boosted its holdings in DigitalOcean by 54.4% during the third quarter. Allworth Financial LP now owns 724 shares of the company’s stock worth $25,000 after buying an additional 255 shares in the last quarter. Transamerica Financial Advisors LLC raised 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 worth $38,000 after purchasing an additional 631 shares during the period. Finally, UMB Bank n.a. lifted its stake in DigitalOcean by 242.1% during the fourth quarter. UMB Bank n.a. now owns 821 shares of the company’s stock valued at $40,000 after buying an additional 581 shares in the last quarter. 49.77% of the stock is owned by institutional investors and hedge funds.

Key Headlines Impacting DigitalOcean

Here are the key news stories impacting DigitalOcean this week:

• Positive Sentiment: Q4 beat and AI momentum: Management reported AI-specific ARR of ~$120M, accelerating revenue growth and raised 2026 guidance — evidence the company is winning higher‑value AI/inference workloads and generating stickier platform revenue. MarketBeat: DigitalOcean’s AI Surge
• Positive Sentiment: Analyst upgrades and higher price targets: Multiple firms raised targets (examples include Barclays, Bank of America and Cantor Fitzgerald), signaling growing analyst confidence — new targets cited in the $69–$86 range. Barclays raise BofA raise Cantor Fitzgerald
• Positive Sentiment: Product / capacity expansion: Company is expanding AMD Instinct GPU capacity and institutional footprint to support inference workloads — helps control costs and supply risk vs. NVIDIA dependency. Yahoo: DigitalOcean expands AMD AI cloud
• Neutral Sentiment: Institutional expansion coverage: Reporting notes DigitalOcean is broadening its cloud infrastructure and institutional reach, which should support longer‑term growth but will require capex execution. KalkineMedia
• Neutral Sentiment: Quarterly metrics analysis available: Analysts are digging into Q4 metrics to reconcile beat/guidance with margins and unit economics — useful for modeling but not an immediate directional catalyst. Zacks Q4 analysis
• Negative Sentiment: Convertible notes hedge risk: A TipRanks analysis flags complexity around DigitalOcean’s 2030 convertible notes hedge — potential dilution, pricing and counterparty risks that could concern shareholders. TipRanks: Convertible notes hedge risk
• Negative Sentiment: Bear/bubble caution: Critics warn the current rally echoes prior cycles (valuation/speculation risks) and highlight margin/cash‑flow tradeoffs as capex ramps to meet demand. Seeking Alpha: It’s 2022 All Over Again

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.