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DocuSign's (DOCU) eSignature Benefits From Customer Demand

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DocuSign, Inc. (DOCU - Free Report) has performed well in the past 6 months. DOCU’s shares have gained 7.2% against the industry’s fall of 3.6% in the same time frame.

DocuSign recently reported first-quarter fiscal 2023 non-GAAP earnings per share of 65 cents that missed the Zacks Consensus Estimate by 22.6% and increased 35.4% year over year. Revenues of $659.6 million surpassed the Zacks Consensus Estimate by 3.2% and increased 13.6% year over year.

DocuSign Price

 

DocuSign Price

DocuSign price | DocuSign Quote

How is DocuSign Doing?

DocuSign is benefitting from the continued demand for its main product eSignatures. Even with such soaring demand, the company is yet to explore many markets that provide it with ample growth opportunity, especially in the eSignature business.

The company has been formulating various growth strategies for aquiring customers, increasing eSignature use cases to existing customers, improving its offerings and popularizing other Agreement Cloud products to new and existing customers, and expanding internationally. The continuing investments in sales, marketing and technical expertise give an idea on how the company is eager to grow.

DocuSign’s  partnership with Salesforce (CRM - Free Report) and Microsoft (MSFT - Free Report) are tailwinds for the company. DocuSign and Salesforce jointly develop solutions for the automation of the contract process and expansion of collaboration among organizations that use Salesforce’s Slack. DocuSign made an eSignature integration with Microsoft Teams last year and is currently an official electronic signature provider in Microsoft Teams’ Approvals app.

DocuSign’s current ratio (a measure of liquidity) stood at 0.74 at the end of fourth-quarter fiscal 2023, lower than the 0.96 recorded at the end of the prior-year quarter. It indicates that the company may have problems meeting its short-term debt obligations.

Zacks Rank and Another Stock to Consider

DocuSign currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors interested in Zacks Business Services sector can consider buying Omnicom Group (OMC - Free Report)

For first-quarter 2023, OMC’s earnings are expected to be in line with the year-ago reported figure of $1.39. The company’s earnings are expected to grow 3.2% on a year-over-year basis in 2023.

The Zacks Consensus Estimate for the company’s first-quarter 2023 earnings is pegged at $1.39, which has been revised downward by 2.1% in the past 60 days. The consensus estimate for the full year is $7.15 per share. This has been revised upward 13.7% in the past 60 days. The company currently sports a Zacks Rank of 1.


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