Piper Sandler upgrades DigitalOcean to Overweight, cuts price target amid AI growth outlook
Piper Sandler raised its rating on DigitalOcean Holdings to Overweight from Neutral, citing accelerating demand for artificial‑intelligence services. The firm lowered its price target to $126 from $142 and noted the company will need about $5 billion of capital through 2028 to fund infrastructure. DigitalOcean shares jumped roughly 5% in pre‑market trading, and analysts project revenue to triple between fiscal 2025 and 2028, with Q3 2026 results due on Nov. 3.
Why it matters
The rating upgrade and lower target may attract investors seeking exposure to AI‑driven cloud growth, while the $5 billion capital estimate signals sizable funding needs that could affect cash flow. Analysts’ revenue‑tripling expectation and upcoming Q3 results provide a near‑term catalyst for the stock.
Key facts
- 1Piper Sandler upgraded DigitalOcean to Overweight from Neutral. investing.com
- 2Piper Sandler lowered the price target to $126 from $142. investing.com
- 3DigitalOcean shares rose about 5% in pre‑market trading after the upgrade. investing.com
- 4Piper Sandler estimates DigitalOcean will need approximately $5 billion in capital through 2028. investing.com
- 5Analysts expect revenue to roughly triple from fiscal 2025 to fiscal 2028. finance.yahoo.com
- 6Management guided Q3 2026 revenue of $304 million to $307 million, up 32%–34% year over year. finance.yahoo.com
Summary written by AlphAI AI Desk from 5 of 5 sources. Not investment advice. Figures are as stated by the linked sources.