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DocuSign (DOCU) Registers a Bigger Fall Than the Market: Important Facts to Note

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In the latest market close, DocuSign (DOCU - Free Report) reached $81.65, with a -0.96% movement compared to the previous day. This move lagged the S&P 500's daily loss of 0.77%. On the other hand, the Dow registered a loss of 0.95%, and the technology-centric Nasdaq decreased by 0.87%.

Prior to today's trading, shares of the provider of electronic signature technology had gained 14.58% over the past month. This has lagged the Computer and Technology sector's gain of 16.73% and outpaced the S&P 500's gain of 11.54% in that time.

The investment community will be paying close attention to the earnings performance of DocuSign in its upcoming release. The company's earnings per share (EPS) are projected to be $0.81, reflecting a 1.22% decrease from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $746.98 million, up 5.26% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $3.46 per share and revenue of $3.13 billion, indicating changes of -2.54% and +5.2%, respectively, compared to the previous year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for DocuSign. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.52% downward. DocuSign currently has a Zacks Rank of #3 (Hold).

Investors should also note DocuSign's current valuation metrics, including its Forward P/E ratio of 23.81. This denotes a discount relative to the industry's average Forward P/E of 27.82.

It is also worth noting that DOCU currently has a PEG ratio of 5.41. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Internet - Software stocks are, on average, holding a PEG ratio of 2.05 based on yesterday's closing prices.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 84, 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.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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