The Share Price Interesting Again: DigitalOcean Holdings Inc. (DOCN)

DigitalOcean Holdings Inc. (NYSE: DOCN), a cloud ecosystem service provider, announced a planned price hike last week. Analysts on Wall Street were upbeat about the decision, expecting it would have only a minimal impact on the company’s client base but may result in large financial gains.

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Prices for DigitalOcean Holdings Inc. (DOCN) services will increase by 20% on July 1st, according to the company. It’s worth emphasizing that this is the company’s first price hike, and it only appears so large at first sight.

Many of the company’s services are reasonably priced; for example, a basic virtual server costs $5 per month. As a result, investors and Wall Street experts expect the rise will not result in significant consumer turnover.

DigitalOcean Holdings Inc. (DOCN)’s move to change its pricing strategy, in particular, was praised by Oppenheimer analysts. The stock’s prior “outperform” rating and $80 price target were maintained by the firm. In an inflationary climate, Oppenheimer believes that the firm with the best price opportunity will perform well because it will utilize the money it earns to improve service. Analysts also boosted their revenue growth predictions for 2022-2023 but did not disclose exact numbers.

Morgan Stanley supports DigitalOcean Holdings Inc. (DOCN) in its plan to boost pricing. Analysts maintained their overweight rating and $61 price target, believing that the price rise will boost key operating and financial indicators such as average revenue per user (ARPU), revenue, and gross margin.

DigitalOcean Holdings Inc. (DOCN) is a cloud and other IT infrastructure developer that builds a holistic ecosystem. The organization, in particular, provides cloud transformation services, website and video hosting, video game and mobile app development solutions, cloud infrastructure for startups, and much more.

DOCN stock rose 12.86% over a week but was down -5.35 percent month over month. Its quarterly price-performance was -18.09%, while its 12-month price-performance was -0.72 percent.