Market Pulse50Neutral

DigitalOcean Holdings, Inc.Opportunity Rank #24(DOCN) Intrinsic Value & DCF Analysis (2026)

Sector: Technology

Current Price

$86.02

Last updated: Mar 24, 2026

Price vs Intrinsic Value

$86.02
Price
$144.62
Intrinsic Value
Undervalued by 68%MOS: $115.70

Fundamental Score

81/100
Bullish

Weighted across 6 signals

Narrative Score

58/100
Improving

No change vs previous

The intrinsic value of DigitalOcean Holdings, Inc. (DOCN) is estimated at $144.62 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $86.02, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 14.65% long-term growth rate and a 10.60% discount rate, reflecting expected future free cash flow and cost of capital.

The intrinsic value of DigitalOcean Holdings, Inc. (DOCN) is estimated at $144.62 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $86.02, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 14.65% long-term growth rate and a 10.60% discount rate, reflecting expected future free cash flow and cost of capital.

Valuation Details

$144.62
▲ 68.12% upside
20% margin of safety: $115.70
Years: 10Growth Rate: 14.65%
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Capital Efficiency

Average Quarterly ROIC
8.03%
Cost of Capital (estimated)7%
Value StatusCreating Value

The company is earning a higher return on invested capital than it costs to raise that capital — a sign of strong, efficient value creation.

Complete historical ROIC is available with
.

Fundamental Details

81/100
BullishWeighted across 6 signals
DCF Discount
68.1% discount to price
100
FCF Yield
7.5% trailing FCF yield
100
ROIC vs WACC
ROIC 8.0% vs WACC 7.0% (1.1x)
57
Net Debt / FCF
0.8x net debt to FCF
84
Buybacks
Share count growing
30
FCF CAGR (5Y)
27.6% 5Y FCF CAGR
100
Strengths: DCF Discount, FCF Yield. Concerns: Buybacks.

Narrative Details

58/100
Improving
Vs 6-Month Baseline:Average (49th pct)Weighted across 5 recent drivers
Trend: StableConfidence: 87%Updated: 1h ago
Sources: 48 (35 News · 13 Analyst)
Drivers(last 30 days)
33 news sentiment+0.8
Regulatory scrutiny+0.0
Analyst upgrades+0.0
Upgrade headlines+0.0
12 analyst reiterations0.0

Investment Coach

Updated 11h ago
BUYConfidence: 71%
Thesis
DigitalOcean Holdings, Inc. is undervalued with an estimated fair value 72.2% above its current price, supported by a strong fundamental score of 81 and a healthy free cash flow yield of 7.5%. The company demonstrates solid returns with ROIC exceeding WACC and consistent free cash flow growth.
Key Risk
A key risk is if the valuation discount narrows below 10% or if ROIC falls below the cost of capital, undermining the investment thesis.
Signals To Watch
  • Monitor whether valuation discount remains above 10%.
  • Confirm ROIC stays above cost of capital over coming quarters.
  • Follow narrative trend for meaningful shifts in the score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 16.49%5 Year CAGR: 19.50%

Free Cash Flow (in millions)

TTM20252024202320222021202020192018
$590$449$469$360$315$242$174$110$99

How Intrinziq Estimates Fair Value

Intrinziq estimates DigitalOcean Holdings, Inc.'s intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

DigitalOcean Holdings, Inc.Technology

DigitalOcean Holdings, Inc., through its subsidiaries, operates a cloud computing platform in North America, Europe, Asia, and internationally. Its platform provides on-demand infrastructure and platform tools for developers, start-ups, and small and medium size businesses. The company offers infrastructure solutions across compute, storage, and networking, as well as enables developers to extend the native capabilities of its cloud with fully managed application, container, and database offerings. Its users include software engineers, researchers, data scientists, system administrators, students, and hobbyists. The company's customers use its platform in various industry verticals and for a range of use cases, such as web and mobile applications, website hosting, e-commerce, media and gaming, personal web projects, managed services, and others. DigitalOcean Holdings, Inc. was incorporated in 2012 and is headquartered in New York, New York.