DocuSign (DOCU) Stock Sinks As Market Gains: Here's Why
DocuSign (DOCU) closed the latest trading day at $58.46, indicating a -0.44% change from the previous session's end. The stock trailed the S&P 500, which registered a daily gain of 0.16%. Elsewhere, the Dow gained 0.02%, while the tech-heavy Nasdaq added 0.16%.
Heading into today, shares of the provider of electronic signature technology had gained 5.29% over the past month, outpacing the Business Services sector's gain of 2.79% and the S&P 500's gain of 2.97% in that time.
Analysts and investors alike will be keeping a close eye on the performance of DocuSign in its upcoming earnings disclosure. The company's earnings report is set to go public on September 5, 2024. In that report, analysts expect DocuSign to post earnings of $0.80 per share. This would mark year-over-year growth of 11.11%. At the same time, our most recent consensus estimate is projecting a revenue of $726.15 million, reflecting a 5.59% rise from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $3.23 per share and a revenue of $2.93 billion, indicating changes of +8.39% and +5.95%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for DocuSign. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Over the past month, there's been no change in the Zacks Consensus EPS estimate. DocuSign currently has a Zacks Rank of #4 (Sell).
With respect to valuation, DocuSign is currently being traded at a Forward P/E ratio of 18.17. This valuation marks a discount compared to its industry's average Forward P/E of 22.74.
We can additionally observe that DOCU currently boasts a PEG ratio of 2.48. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Technology Services stocks are, on average, holding a PEG ratio of 1.56 based on yesterday's closing prices.
The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 83, which puts it in the top 33% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Docusign Inc. (DOCU) : Free Stock Analysis Report