Needham analyst Mike Cikos has maintained their neutral stance on DOCN stock, giving a Hold rating on April 2.
Mike Cikos has given his Hold rating due to a combination of factors related to DigitalOcean Holdings’ recent performance and future outlook. The company has set ambitious growth targets, aiming for 18%-20% year-over-year growth by 2027, with expectations of further acceleration beyond that. Management’s confidence is bolstered by several growth initiatives, including enhancements in their go-to-market strategy and product offerings.
However, despite these positive indicators, Cikos notes that the macroeconomic environment poses a challenge, particularly due to the sensitivity of DigitalOcean’s customer base to economic fluctuations. This economic volatility could impact the company’s ability to achieve its growth targets in the near term. As a result, while there is potential for long-term growth, the current economic conditions warrant a more cautious approach, leading to the Hold rating.
According to TipRanks, Cikos is a 4-star analyst with an average return of 3.3% and a 40.44% success rate. Cikos covers the Technology sector, focusing on stocks such as Cellebrite DI, Dynatrace, and Cloudflare.
In another report released on April 2, Cantor Fitzgerald also maintained a Hold rating on the stock with a $38.00 price target.