DigitalOcean Holdings (DOCN – Research Report), the Technology sector company, was revisited by a Wall Street analyst yesterday. Analyst Mark Zhang from Citi maintained a Buy rating on the stock and has a $40.00 price target.
Mark Zhang’s rating is based on the strong business momentum and significant milestones achieved by DigitalOcean Holdings. The company has shown impressive product innovation and go-to-market strategies, particularly in the Scalers+ segment, where revenue growth has accelerated. This indicates a positive trend in the company’s performance, despite some uncertainties regarding free cash flow and investment needs.
Furthermore, DigitalOcean has demonstrated enterprise-level traction with substantial multi-year commitments, which reinforces confidence in its growth trajectory. While there are concerns about the visibility of free cash flow and potential pressures on shares, the overall healthy business momentum and strategic initiatives suggest a promising outlook, justifying the Buy rating.
According to TipRanks, Zhang is an analyst with an average return of -18.9% and a 0.00% success rate.
In another report released today, Barclays also maintained a Buy rating on the stock with a $38.00 price target.