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DocuSign (DOCU) Outpaces Stock Market Gains: What You Should Know

DocuSign (DOCU) closed the most recent trading day at $227.68, moving +0.62% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.36%. At the same time, the Dow added 0.62%, and the tech-heavy Nasdaq gained 0.35%.

Wall Street will be looking for positivity from DOCU as it approaches its next earnings report date. In that report, analysts expect DOCU to post earnings of $0.07 per share. This would mark year-over-year growth of 600%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $318.37 million, up 35.13% from the year-ago period.

DOCU's full-year Zacks Consensus Estimates are calling for earnings of $0.46 per share and revenue of $1.32 billion. These results would represent year-over-year changes of +48.39% and +35.04%, respectively.

Investors might also notice recent changes to analyst estimates for DOCU. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. DOCU is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, DOCU is holding a Forward P/E ratio of 494.6. For comparison, its industry has an average Forward P/E of 34.41, which means DOCU is trading at a premium to the group.

Investors should also note that DOCU has a PEG ratio of 15.86 right now. 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 currently had an average PEG ratio of 5.94 as of yesterday's close.

The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 169, which puts it in the bottom 34% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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