Docusign (NASDAQ:DOCU) Stock Price Down 7.7% - Should You Sell?

Key Points

• Docusign's stock price has decreased by 7.7%, trading as low as $77.56 before closing at $75.82, with a significant drop in trading volume.
• Analysts have set a consensus rating of "Hold" for Docusign, with an average price target of $94.14, while several firms have raised their price targets to between $90.00 and $92.00.
• The company reported strong quarterly earnings, with $800.64 million in revenue and an EPS of $0.92, surpassing analyst expectations.

Docusign Inc. (NASDAQ:DOCU - Get Free Report)'s share price dropped 7.7% during trading on Tuesday . The company traded as low as $77.56 and last traded at $75.82. Approximately 966,901 shares changed hands during mid-day trading, a decline of 64% from the average daily volume of 2,668,024 shares. The stock had previously closed at $82.14.

Analysts Set New Price Targets

DOCU has been the subject of a number of research analyst reports. Evercore ISI boosted their target price on Docusign from $90.00 to $92.00 and gave the company an "in-line" rating in a research report on Friday, September 5th. Zacks Research upgraded Docusign from a "hold" rating to a "strong-buy" rating in a research note on Tuesday, September 9th. Piper Sandler lifted their price target on Docusign from $85.00 to $90.00 and gave the company a "neutral" rating in a research note on Friday, September 5th. Argus reiterated a "hold" rating on shares of Docusign in a research note on Monday, September 8th. Finally, Morgan Stanley lifted their price target on Docusign from $86.00 to $90.00 and gave the company an "equal weight" rating in a research note on Monday, September 8th. One analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating and fourteen have issued a Hold rating to the company. According to data from MarketBeat.com, Docusign presently has a consensus rating of "Hold" and an average price target of $94.14.

Docusign Trading Down 11.1%

The company has a market capitalization of $14.69 billion, a PE ratio of 54.88, a P/E/G ratio of 4.27 and a beta of 1.02. The stock's fifty day moving average is $77.05 and its two-hundred day moving average is $79.42.

Docusign (NASDAQ:DOCU - Get Free Report) last announced its quarterly earnings data on Thursday, September 4th. The company reported $0.92 EPS for the quarter, topping the consensus estimate of $0.84 by $0.08. Docusign had a net margin of 9.08% and a return on equity of 14.01%. The business had revenue of $800.64 million for the quarter, compared to analyst estimates of $780.35 million. During the same quarter in the previous year, the firm posted $0.97 earnings per share. The company's revenue for the quarter was up 8.8% on a year-over-year basis. Docusign has set its Q3 2026 guidance at EPS. FY 2026 guidance at EPS. As a group, analysts anticipate that Docusign Inc. will post 1.17 EPS for the current fiscal year.

Docusign declared that its Board of Directors has approved a stock buyback plan on Thursday, June 5th that permits the company to repurchase $1.00 billion in shares. This repurchase authorization permits the company to repurchase up to 6.6% of its shares through open market purchases. Shares repurchase plans are often an indication that the company's board of directors believes its shares are undervalued.

Insider Transactions at Docusign

In other news, Director Anna Marrs sold 728 shares of the business's stock in a transaction dated Monday, September 15th. The stock was sold at an average price of $80.30, for a total transaction of $58,458.40. Following the completion of the transaction, the director owned 10,799 shares of the company's stock, valued at approximately $867,159.70. The trade was a 6.32% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director James A. Beer sold 450 shares of the firm's stock in a transaction that occurred on Tuesday, September 16th. The shares were sold at an average price of $81.28, for a total transaction of $36,576.00. Following the completion of the sale, the director directly owned 14,199 shares in the company, valued at $1,154,094.72. This represents a 3.07% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last quarter, insiders have sold 42,533 shares of company stock worth $3,497,628. 1.66% of the stock is owned by insiders.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of the business. State Street Corp grew its position in Docusign by 3.0% during the second quarter. State Street Corp now owns 8,074,976 shares of the company's stock valued at $628,960,000 after acquiring an additional 236,494 shares during the last quarter. American Century Companies Inc. increased its stake in shares of Docusign by 1.6% in the second quarter. American Century Companies Inc. now owns 5,564,318 shares of the company's stock worth $433,405,000 after buying an additional 86,560 shares during the period. Geode Capital Management LLC increased its stake in shares of Docusign by 1.5% in the second quarter. Geode Capital Management LLC now owns 3,985,808 shares of the company's stock worth $309,910,000 after buying an additional 59,941 shares during the period. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC increased its stake in shares of Docusign by 18.6% in the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 2,028,505 shares of the company's stock worth $165,120,000 after buying an additional 318,698 shares during the period. Finally, Wellington Management Group LLP increased its stake in shares of Docusign by 372.5% in the first quarter. Wellington Management Group LLP now owns 1,826,949 shares of the company's stock worth $148,714,000 after buying an additional 1,440,269 shares during the period. 77.64% of the stock is currently owned by institutional investors.

Docusign Company Profile

DocuSign, Inc provides electronic signature solution in the United States and internationally. The company provides e-signature solution that enables sending and signing of agreements on various devices; Contract Lifecycle Management (CLM), which automates workflows across the entire agreement process; Document Generation streamlines the process of generating new, custom agreements; and Gen for Salesforce, which allows sales representatives to automatically generate agreements with a few clicks from within Salesforce.

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