The stock market declined on Thursday after strong labor data raised fears of another interest rate hike by the central bank.
Private sector jobs increased by half a million in June, according to data from ADP Research Institute. Although this data often differs from the goverment’s employment report, such is consistent with the labor market trend.
The official June payrolls report will be out by Friday, and economists expect non-farm payrolls to slow down in June.
Overall, S&P 500 and NASDAQ both fell 0.8% to 4,412 and 13,679, respectively.
Tweet of the Day
https://twitter.com/HedgeMind/status/1677049031724511232?t=MZeY2EWbs5JoSSjDdFDZCA&s=08
Chart of the Day
Here is the one-year chart of DigitalOcean (DOCN) as of June 14, 2023, when the stock was at $46.
DigitalOcean is a simplified cloud computing platform that management claims is substantially cheaper (20% to 60% less) than the large cloud providers. The platform is secure, reliable, it scales and its cheap. DigitalOcean is used by small and mid-sized businesses (SMBs) that are looking to get the most for their money.
In September 2022, DigitalOcean acquired Cloudways, a hosting and software company for small & medium sized businesses.
DigitalOcean celebrates the second year anniversary of its IPO with drastic improvements in the company’s financial profile. Revenues have doubled from 2020, a year before its IPO, while its adjusted free cash flow has improved from -18% in 2020 to +21% this year. Last qtr, the company enjoyed profit growth of 300% and revenue growth of 30% as the company battled macroeconomic headwinds. Churn remained steady which management saw as a great accomplishment amid a low-growth environment pressured by decreased expansion and elevated contraction. Management has also bought back $1.3 billion in stock since 2021 Q2.
Today in the stock market, DOCN soared as the company acquired Paperspace to expand its artificial intelligence (AI) offerings. This will enable DigitalOcean’s customers to more easily test, develop and deploy AI and machine learning (AI/ML) applications.
DOCN is on the radar for the Growth Portfolio.
