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DocuSign (DOCU) Dips More Than Broader Markets: What You Should Know

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DocuSign (DOCU - Free Report) closed at $101.95 in the latest trading session, marking a -0.75% move from the prior day. This change lagged the S&P 500's daily loss of 0.27%. Elsewhere, the Dow gained 0.4%, while the tech-heavy Nasdaq lost 0.18%.

Coming into today, shares of the provider of electronic signature technology had gained 9.42% in the past month. In that same time, the Business Services sector gained 9.43%, while the S&P 500 gained 7.36%.

DocuSign will be looking to display strength as it nears its next earnings release. In that report, analysts expect DocuSign to post earnings of $0.46 per share. This would mark year-over-year growth of 4.55%. Our most recent consensus estimate is calling for quarterly revenue of $581.05 million, up 23.87% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.99 per share and revenue of $2.48 billion. These totals would mark changes of +0.51% and +17.52%, respectively, from last year.

Any recent changes to analyst estimates for DocuSign should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 301.61% lower within the past month. DocuSign is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that DocuSign has a Forward P/E ratio of 51.62 right now. This valuation marks a premium compared to its industry's average Forward P/E of 21.53.

Investors should also note that DOCU has a PEG ratio of 3.13 right now. 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 2.08 as of yesterday's close.

The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 171, which puts it in the bottom 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow DOCU in the coming trading sessions, be sure to utilize Zacks.com.


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