DigitalOcean upgraded to Equal Weight from Underweight at Morgan Stanley

Morgan Stanley analyst Josh Baer upgraded DigitalOcean to Equal Weight from Underweight with a price target of $36, up from $30. The firm says its Underweight thesis largely played out with the company’s lower outlook for fiscal 2023 revenue and lower future free cash flow margins representing a “key catalyst in the rear-view mirror.” DigitalOcean’s current outlook appears achievable, investor sentiment is low and the large stock move down more appropriately reflects the risks, the analyst tells investors in a research note.