DocuSign (DOCU) closed at $56.22 in the latest trading session, marking a +1.43% move from the prior day. The stock outperformed the S&P 500, which registered a daily loss of 0.01%. Elsewhere, the Dow saw an upswing of 0.03%, while the tech-heavy Nasdaq appreciated by 0.17%.
Shares of the provider of electronic signature technology have depreciated by 19.77% over the course of the past month, underperforming the Computer and Technology sector's gain of 1.46%, and the S&P 500's gain of 0.78%.
Market participants will be closely following the financial results of DocuSign in its upcoming release. In that report, analysts expect DocuSign to post earnings of $0.95 per share. This would mark year-over-year growth of 10.47%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $827.15 million, up 6.56% from the year-ago period.
DOCU's full-year Zacks Consensus Estimates are calling for earnings of $3.79 per share and revenue of $3.21 billion. These results would represent year-over-year changes of +6.76% and +7.83%, respectively.
Investors might also notice recent changes to analyst estimates for DocuSign. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Currently, DocuSign is carrying a Zacks Rank of #3 (Hold).
In the context of valuation, DocuSign is at present trading with a Forward P/E ratio of 14.64. Its industry sports an average Forward P/E of 23.28, so one might conclude that DocuSign is trading at a discount comparatively.
Investors should also note that DOCU has a PEG ratio of 1.02 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Software was holding an average PEG ratio of 1.37 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 77, positioning it in the top 32% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Docusign Inc. (DOCU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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