Zacks Research Upgrades Docusign (NASDAQ:DOCU) to Strong-Buy

Key Points

• Zacks Research has upgraded Docusign (NASDAQ:DOCU) from a "hold" rating to a "strong-buy" rating, indicating increased confidence in the company's future performance.
• Docusign reported a quarterly revenue of $800.64 million, surpassing expectations by 8.8% year-over-year and posting earnings per share of $0.92.
• The company has announced a $1.00 billion share buyback program, suggesting that its board believes the stock is currently undervalued.

Docusign (NASDAQ:DOCU - Get Free Report) was upgraded by analysts at Zacks Research from a "hold" rating to a "strong-buy" rating in a research note issued on Tuesday,Zacks.com reports.

A number of other equities analysts also recently issued reports on the company. UBS Group set a $95.00 price target on Docusign in a research report on Friday, September 5th. Citigroup increased their price target on Docusign from $110.00 to $115.00 and gave the stock a "buy" rating in a research report on Thursday, September 4th. Evercore ISI increased their price target on Docusign from $90.00 to $92.00 and gave the stock an "in-line" rating in a research report on Friday, September 5th. Needham & Company LLC restated a "hold" rating on shares of Docusign in a research report on Friday, September 5th. Finally, JPMorgan Chase & Co. raised their target price on Docusign from $77.00 to $80.00 and gave the company a "neutral" rating in a research report on Friday, September 5th. One research analyst has rated the stock with a Strong Buy rating, four have issued a Buy rating and fourteen have assigned a Hold rating to the company's stock. According to data from MarketBeat, the stock currently has an average rating of "Hold" and an average price target of $94.14.

Docusign Price Performance

Shares of NASDAQ DOCU opened at $78.82 on Tuesday. The stock has a market capitalization of $15.85 billion, a P/E ratio of 59.26, a price-to-earnings-growth ratio of 4.18 and a beta of 1.02. Docusign has a 1-year low of $54.31 and a 1-year high of $107.86. The business has a fifty day moving average price of $75.69 and a 200 day moving average price of $79.29.

Docusign (NASDAQ:DOCU - Get Free Report) last issued its quarterly earnings data on Thursday, September 4th. The company reported $0.92 earnings per share for the quarter, topping analysts' consensus estimates of $0.84 by $0.08. Docusign had a return on equity of 14.01% and a net margin of 9.08%.The firm had revenue of $800.64 million during the quarter, compared to analysts' expectations of $780.35 million. During the same period in the prior year, the business posted $0.97 EPS. The firm's quarterly revenue 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, equities research analysts anticipate that Docusign will post 1.17 earnings per share for the current fiscal year.

Docusign declared that its Board of Directors has approved a share buyback program on Thursday, June 5th that authorizes the company to buyback $1.00 billion in outstanding shares. This buyback authorization authorizes the company to reacquire up to 6.6% of its stock through open market purchases. Stock buyback programs are typically an indication that the company's board believes its stock is undervalued.

Insider Buying and Selling

In related news, CEO Allan C. Thygesen sold 40,000 shares of Docusign stock in a transaction that occurred on Tuesday, July 1st. The stock was sold at an average price of $77.51, for a total transaction of $3,100,400.00. Following the transaction, the chief executive officer owned 143,983 shares in the company, valued at approximately $11,160,122.33. This trade represents a 21.74% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through this link. Also, Director Teresa Briggs sold 534 shares of Docusign stock in a transaction that occurred on Monday, June 16th. The stock was sold at an average price of $74.37, for a total value of $39,713.58. Following the transaction, the director owned 8,805 shares in the company, valued at approximately $654,827.85. The trade was a 5.72% decrease in their position. The disclosure for this sale can be found here. In the last ninety days, insiders have sold 78,552 shares of company stock worth $5,983,631. 1.01% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Docusign

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Norges Bank acquired a new stake in shares of Docusign in the second quarter valued at $140,987,000. Wellington Management Group LLP grew 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 valued at $148,714,000 after buying an additional 1,440,269 shares in the last quarter. Duquesne Family Office LLC acquired a new stake in shares of Docusign in the first quarter valued at $87,477,000. Pacer Advisors Inc. grew its stake in shares of Docusign by 809.6% in the first quarter. Pacer Advisors Inc. now owns 1,167,290 shares of the company's stock valued at $95,017,000 after buying an additional 1,038,962 shares in the last quarter. Finally, Third Point LLC acquired a new stake in shares of Docusign in the second quarter valued at $48,681,000. Institutional investors and hedge funds own 77.64% of the company's stock.

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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