Wall Street Zen Upgrades Docusign (NASDAQ:DOCU) to "Strong-Buy"

Key Points

• Wall Street Zen upgraded Docusign from “buy” to “strong-buy”, adding a bullish note to the stock despite broader cautious sentiment from other analysts.
• Docusign recently beat quarterly expectations, reporting $1.09 EPS versus $0.99 expected and revenue of $830.24 million, with revenue up 8.7% year over year.
• The company also authorized a $2 billion share repurchase program, which management can use to buy back up to 21% of outstanding shares and may signal confidence the stock is undervalued.

Docusign (NASDAQ:DOCU - Get Free Report) was upgraded by Wall Street Zen from a "buy" rating to a "strong-buy" rating in a research report issued on Saturday.

A number of other analysts have also commented on DOCU. Piper Sandler lowered their target price on shares of Docusign from $75.00 to $52.00 and set a "neutral" rating for the company in a report on Wednesday, March 18th. Wedbush dropped their price objective on Docusign from $60.00 to $58.00 and set a "neutral" rating for the company in a report on Friday, June 5th. Robert W. Baird reduced their target price on Docusign from $75.00 to $55.00 and set a "neutral" rating on the stock in a report on Wednesday, March 18th. Bank of America began coverage on Docusign in a report on Tuesday, March 31st. They set an "underperform" rating and a $52.00 target price on the stock. Finally, Morgan Stanley reduced their target price on Docusign from $90.00 to $69.00 and set an "equal weight" rating on the stock in a report on Wednesday, March 18th. Three research analysts have rated the stock with a Buy rating, fifteen have given a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of "Hold" and an average price target of $60.27.

Docusign Stock Performance

Shares of DOCU opened at $45.03 on Friday. The firm has a market capitalization of $8.60 billion, a price-to-earnings ratio of 29.24, a PEG ratio of 1.35 and a beta of 0.92. The business's fifty day moving average price is $47.56 and its two-hundred day moving average price is $53.47. Docusign has a 52 week low of $40.16 and a 52 week high of $86.65.

Docusign (NASDAQ:DOCU - Get Free Report) last announced its quarterly earnings data on Thursday, June 4th. The company reported $1.09 earnings per share for the quarter, topping the consensus estimate of $0.99 by $0.10. The firm had revenue of $830.24 million during the quarter, compared to analysts' expectations of $824.71 million. Docusign had a return on equity of 17.48% and a net margin of 9.59%.The company's quarterly revenue was up 8.7% compared to the same quarter last year. During the same period in the previous year, the business posted $0.90 EPS. As a group, research analysts forecast that Docusign will post 1.97 EPS for the current year.

Docusign announced that its board has initiated a share buyback plan on Tuesday, March 17th that allows the company to repurchase $2.00 billion in outstanding shares. This repurchase authorization allows the company to purchase up to 21% of its stock through open market purchases. Stock repurchase plans are typically a sign that the company's leadership believes its shares are undervalued.

Insider Buying and Selling

In other news, CEO Allan C. Thygesen sold 26,250 shares of Docusign stock in a transaction that occurred on Wednesday, April 1st. The shares were sold at an average price of $47.78, for a total value of $1,254,225.00. Following the sale, the chief executive officer directly owned 152,237 shares in the company, valued at $7,273,883.86. This trade represents a 14.71% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CRO Paula Hansen sold 6,000 shares of Docusign stock in a transaction that occurred on Wednesday, April 1st. The shares were sold at an average price of $46.84, for a total transaction of $281,040.00. Following the completion of the sale, the executive owned 79,233 shares in the company, valued at $3,711,273.72. This trade represents a 7.04% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 65,489 shares of company stock valued at $3,125,814 over the last ninety days. Insiders own 0.59% of the company's stock.

Institutional Inflows and Outflows

Institutional investors have recently modified their holdings of the company. Central Pacific Bank Trust Division acquired a new position in Docusign during the fourth quarter worth approximately $25,000. Modus Advisors LLC acquired a new position in Docusign during the fourth quarter worth approximately $27,000. Torren Management LLC acquired a new position in Docusign during the fourth quarter worth approximately $28,000. Aventura Private Wealth LLC acquired a new position in Docusign during the fourth quarter worth approximately $30,000. Finally, True Wealth Design LLC increased its position in Docusign by 105.2% during the fourth quarter. True Wealth Design LLC now owns 433 shares of the company's stock worth $30,000 after buying an additional 222 shares during the last quarter. 77.64% of the stock is currently owned by institutional investors and hedge funds.

About Docusign

DocuSign, Inc NASDAQ: DOCU is a leading provider of electronic signature and digital transaction management solutions. The company's flagship offering, DocuSign eSignature, enables organizations to send, sign and manage legally binding electronic agreements securely in the cloud. Beyond eSignature, DocuSign's Agreement Cloud combines contract lifecycle management, document generation, and workflow automation to streamline agreement processes from initiation through execution and storage.

DocuSign's platform serves a diverse customer base spanning industries such as finance, real estate, healthcare, technology, and government.

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