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Docusign's eSignature Demand Aids Top Line Despite Rising Costs
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Docusign, Inc. (DOCU - Free Report) shares have gained 6.3% over the past three months against the marginal decline of the industry it belongs to and compared with the marginal rise of the Zacks S&P 500 composite.
DOCUreported impressive second-quarter fiscal 2025 results. EPS (excluding $3.29 from non-recurring items) was 97 cents, which surpassed the Zacks Consensus Estimate by 21.3% and increased 34.7% from the year-ago quarter. Total revenues of $736 million beat the consensus mark by 1.4% and gained 7% from second-quarter fiscal 2024.
How is Docusign Doing?
DOCU’s anchor product, eSignature, allows the virtual and secure signing, and transferring of agreements on a variety of devices across the globe. The continued customer demand for eSignature benefits Docusign’s revenues. Despite this rising demand, the market for eSignature remains unexplored to a great extent, and this allows DOCU to be able to expand eSignature around the world.
Docusign has strengthened its relationships with partners such as Salesforce and Microsoft. DOCU and Salesforce collaborated to develop solutions for the automation of the contract process and the expansion of collaboration among organizations that use Salesforce’s Slack. The company made an eSignature integration with Microsoft Teams the preceding year and is the current official electronic signature provider in Microsoft Teams’ Approvals app.
DOCU leverages its growth strategies, which include merger and acquisitions and investments in different verticals. The company aims to acquire eSignature customers, expand the use cases of the product within existing customers, enhance its offerings, popularize other Agreement Cloud products to new and existing customers, and expand to different geographies. DOCU continues to invest in sales, marketing and technical expertise across several industry verticals.
Meanwhile, Docusign is witnessing a rise in expenses as it continues to invest in sales, marketing and technical expertise. Total operating expenses of $2.2 billion increased 4.3% year over year in fiscal 2024. A rise in expenses can put the bottom line under pressure in the future.
Dividend-seeking investors should stay away from DOCU since it has never declared and does not have any intention to pay out cash dividends at present. Therefore, the only way to achieve a return on investment on the company’s stock is share price appreciation, which is not guaranteed.
Zacks Rank & Stocks to Consider
Docusign sports a Zacks Rank #1 (Strong Buy) at present.
Image: Bigstock
Docusign's eSignature Demand Aids Top Line Despite Rising Costs
Docusign, Inc. (DOCU - Free Report) shares have gained 6.3% over the past three months against the marginal decline of the industry it belongs to and compared with the marginal rise of the Zacks S&P 500 composite.
DOCUreported impressive second-quarter fiscal 2025 results. EPS (excluding $3.29 from non-recurring items) was 97 cents, which surpassed the Zacks Consensus Estimate by 21.3% and increased 34.7% from the year-ago quarter. Total revenues of $736 million beat the consensus mark by 1.4% and gained 7% from second-quarter fiscal 2024.
How is Docusign Doing?
DOCU’s anchor product, eSignature, allows the virtual and secure signing, and transferring of agreements on a variety of devices across the globe. The continued customer demand for eSignature benefits Docusign’s revenues. Despite this rising demand, the market for eSignature remains unexplored to a great extent, and this allows DOCU to be able to expand eSignature around the world.
Docusign has strengthened its relationships with partners such as Salesforce and Microsoft. DOCU and Salesforce collaborated to develop solutions for the automation of the contract process and the expansion of collaboration among organizations that use Salesforce’s Slack. The company made an eSignature integration with Microsoft Teams the preceding year and is the current official electronic signature provider in Microsoft Teams’ Approvals app.
DOCU leverages its growth strategies, which include merger and acquisitions and investments in different verticals. The company aims to acquire eSignature customers, expand the use cases of the product within existing customers, enhance its offerings, popularize other Agreement Cloud products to new and existing customers, and expand to different geographies. DOCU continues to invest in sales, marketing and technical expertise across several industry verticals.
Docusign Inc. Revenue (TTM)
Docusign Inc. revenue-ttm | Docusign Inc. Quote
Meanwhile, Docusign is witnessing a rise in expenses as it continues to invest in sales, marketing and technical expertise. Total operating expenses of $2.2 billion increased 4.3% year over year in fiscal 2024. A rise in expenses can put the bottom line under pressure in the future.
Dividend-seeking investors should stay away from DOCU since it has never declared and does not have any intention to pay out cash dividends at present. Therefore, the only way to achieve a return on investment on the company’s stock is share price appreciation, which is not guaranteed.
Zacks Rank & Stocks to Consider
Docusign sports a Zacks Rank #1 (Strong Buy) at present.
Some other top-ranked stocks in the broader Zacks Business Services sector are Charles River Associates (CRAI - Free Report) and Evertec (EVTC - Free Report) .
Charles River Associates flaunts a Zacks Rank #1 at present. It has a long-term earnings growth expectation of 16%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
CRAI delivered a trailing four-quarter earnings surprise of 23.5%, on average.
Evertec sports a Zacks Rank #1 at present. It has a long-term earnings growth expectation of 8%.
EVTC delivered a trailing four-quarter earnings surprise of 11.1%, on average.