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DocuSign (DOCU) Gains But Lags Market: What You Should Know

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DocuSign (DOCU - Free Report) closed at $115.07 in the latest trading session, marking a +1.33% move from the prior day. The stock lagged the S&P 500's daily gain of 2.24%. Elsewhere, the Dow gained 2.51%, while the tech-heavy Nasdaq lost 0.2%.

Prior to today's trading, shares of the provider of electronic signature technology had gained 2.59% over the past month. This has outpaced the Business Services sector's loss of 3.35% and the S&P 500's loss of 2.58% in that time.

DocuSign will be looking to display strength as it nears its next earnings release, which is expected to be March 10, 2022. The company is expected to report EPS of $0.48, up 29.73% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $560.8 million, up 30.15% from the prior-year quarter.

Any recent changes to analyst estimates for DocuSign should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. DocuSign is currently a Zacks Rank #3 (Hold).

Looking at its valuation, DocuSign is holding a Forward P/E ratio of 52.02. This represents a premium compared to its industry's average Forward P/E of 22.47.

Meanwhile, DOCU's PEG ratio is currently 1.09. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Technology Services industry currently had an average PEG ratio of 1.9 as of yesterday's close.

The Technology Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 169, putting it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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