DocuSign (DOCU) ended the recent trading session at $72.31, demonstrating a +1.89% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily loss of 0.02%. On the other hand, the Dow registered a loss of 0.35%, and the technology-centric Nasdaq decreased by 0.15%.
Prior to today's trading, shares of the provider of electronic signature technology had gained 1.73% lagged the Computer and Technology sector's gain of 3.58% and the S&P 500's gain of 2.05%.
Market participants will be closely following the financial results of DocuSign in its upcoming release. On that day, DocuSign is projected to report earnings of $1.17 per share, which would represent year-over-year growth of 15.84%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $888.77 million, up 8.61% from the year-ago period.
For the full year, the Zacks Consensus Estimates project earnings of $4.59 per share and a revenue of $3.5 billion, demonstrating changes of +19.53% and +8.76%, respectively, from the preceding year.
It is also important to note the recent changes to analyst estimates for DocuSign. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.61% higher. DocuSign currently has a Zacks Rank of #3 (Hold).
Investors should also note DocuSign's current valuation metrics, including its Forward P/E ratio of 15.45. This signifies a discount in comparison to the average Forward P/E of 20.7 for its industry.
We can also see that DOCU currently has a PEG ratio of 1.22. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Software stocks are, on average, holding a PEG ratio of 1.19 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 79, which puts it in the top 33% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Docusign Inc. (DOCU): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).