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DocuSign (DOCU) Stock Slides as Market Rises: Facts to Know Before You Trade

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The latest trading session saw DocuSign (DOCU - Free Report) ending at $59.50, denoting a -0.5% adjustment from its last day's close. The stock fell short of the S&P 500, which registered a gain of 1.03% for the day. Elsewhere, the Dow gained 0.46%, while the tech-heavy Nasdaq added 1.19%.

Prior to today's trading, shares of the provider of electronic signature technology had gained 0.55% over the past month. This has outpaced the Business Services sector's loss of 3.42% and the S&P 500's loss of 1.57% in that time.

Market participants will be closely following the financial results of DocuSign in its upcoming release. The company is expected to report EPS of $0.79, up 9.72% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $706.07 million, indicating a 6.76% growth compared to the corresponding quarter of the prior year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.24 per share and a revenue of $2.92 billion, indicating changes of +8.72% and +5.77%, respectively, from the former year.

Investors should also pay attention to any latest changes in analyst estimates for DocuSign. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been a 1.16% rise in the Zacks Consensus EPS estimate. Currently, DocuSign is carrying a Zacks Rank of #2 (Buy).

Investors should also note DocuSign's current valuation metrics, including its Forward P/E ratio of 18.44. This expresses a discount compared to the average Forward P/E of 23.12 of its industry.

Meanwhile, DOCU's PEG ratio is currently 1.39. 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 had an average PEG ratio of 1.51 as trading concluded yesterday.

The Technology Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 87, putting it in the top 35% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these 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 to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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