1 Top AI Growth Stock to Invest in Before a Projected 35% Surge, Says Wall Street
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 28 2025
0mins
Source: NASDAQ.COM
DigitalOcean's Growth: DigitalOcean is experiencing improved growth rates due to increased adoption of its AI-focused cloud services, expecting double-digit growth over the next three years.
Attractive Valuation: The stock is currently undervalued, trading at 23 times trailing earnings and a forward multiple of 15, with analysts projecting a potential price target of $42, indicating a 35% upside.
Customer Acquisition and Spending: The company has seen significant customer growth, with over 6,000 new users on its Gradient AI platform, leading to a 12% year-over-year increase in average revenue per customer.
Future Revenue Projections: DigitalOcean anticipates annual revenue growth of 18% to 20%, potentially reaching $1.28 billion by 2027, which could result in a market cap increase of 132% based on current valuations.
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Analyst Views on DOCN
Wall Street analysts forecast DOCN stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for DOCN is 55.90 USD with a low forecast of 47.00 USD and a high forecast of 65.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
12 Analyst Rating
8 Buy
4 Hold
0 Sell
Moderate Buy
Current: 56.130
Low
47.00
Averages
55.90
High
65.00
Current: 56.130
Low
47.00
Averages
55.90
High
65.00
About DOCN
DigitalOcean Holdings, Inc. provides the simplest scalable cloud platform that democratizes cloud and AI for growing tech companies around the world. It provides a cloud computing platform, offering simple, scalable and approachable on-demand infrastructure and platform services for developers at growing technology companies. Its platform simplifies cloud computing, enabling its customers to rapidly accelerate innovation and productivity. The simplicity of its platform allows users to focus on building and scaling their business instead of on managing their infrastructure. It offers mission-critical solutions across Infrastructure-as-a-Service (IaaS), including its Droplet virtual machines, storage and networking offerings; Platform-as-a-Service and Software-as-a-Service, including its Managed Hosting, Managed Database, Managed Kubernetes and Marketplace offerings; and artificial intelligence and machine learning, including its GPU Droplets, Notebooks and GenAI Platform offerings.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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