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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#2396
Positioning
Market Dominance
Services
Computer Software
$14.7B
Allan C. Thygesen
DocuSign provides e-signature solution that enables businesses to digitally prepare, sign, act on, and manage agreements. It also offers CLM, which automates workflows across the entire agreement process. The company sells its products through direct, partner-assisted, and Web-based sales.
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Get full access to institutional-quality research tools with Blank Capital Pro.
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Get full access to institutional-quality research tools with Blank Capital Pro.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = DOCU ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$YALA Yalla Group Ltd | 75 | 89 | 99 | 80 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$GRVY GRAVITY Co., Ltd. | 75 | 82 | 96 | 71 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ISSC INNOVATIVE SOLUTIONS & SUPPORT INC | 73 | 81 | 88 | 94 | 25.0x | 14.1x | 17.1% | 10.3% | 35.5% | 14.6% | 10.1% | 105.2% | 0.0% | 41.0x | $244M | VS | |
$AER AerCap Holdings N.V. | 72 | 60 | 87 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$HCSG HEALTHCARE SERVICES GROUP INC | 72 | 74 | 88 | 88 | 7.1x | 6.1x | 28.9% | 20.8% | 20.8% | 9.9% | 9.3% | 8.5% | 0.0% | 1.0x | $1.2B | VS | |
$LQDT LIQUIDITY SERVICES INC | 72 | 90 | 88 | 68 | 24.9x | 14.3x | 14.1% | 8.3% | 45.7% | 8.5% | 6.2% | 28.1% | 0.0% | 0.0x | $736M | VS | |
$TRTNpA Triton International Ltd | 71 | 70 | 89 | 70 | - | 1.7x | 0.0% | - | 97.4% | 58.0% | 37.4% | - | 8.8% | 264.0x | $2.5B | VS | |
$EDU New Oriental Education & Technology Group Inc. | 71 | 83 | 52 | 77 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$NTES NetEase, Inc. | 71 | 88 | 93 | 68 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$UTI UNIVERSAL TECHNICAL INSTITUTE INC | 70 | 86 | 86 | 72 | 43.2x | 16.0x | 15.3% | 5.8% | 100.0% | 6.9% | 5.2% | 15.1% | 0.0% | 24.0x | $1.8B | VS | |
$DOCU DOCUSIGN, INC. | 48 | 69 | 54 | 27 | 31.7x | 33.0x | 14.2% | 7.1% | 79.3% | 8.6% | 8.9% | 11.2% | 0.0% | 101.0x | $14.7B | ||
| SECTOR BENCH | - | - | - | - | - | 23.7x | 11.7x | 5.7% | 2.4% | 64.6% | 4.5% | 2.8% | 8.6% | 0.0% | 0.3x | - | REF |
DOCUSIGN, INC. (DOCU) receives a "Reduce" rating with a composite score of 47.6/100. It ranks #2396 out of 7,333 stocks in our coverage universe and carries a 2-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Lagging peers — losers tend to keep underperforming
Fair valuation relative to peers
High profitability & efficiency — strong quality floor supports entry
Average volatility — neutral timing signal
Moderate investment profile
Mid-range overall rating
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Relative valuation derived from Services sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for DOCU.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 69 | 84 | -15DRAG |
| MOMENTUM | 27 | 20 | +7ALPHA |
| VALUATION | 54 | 59 | -5NEUTRAL |
| INVESTMENT | 41 | 70 | -29DRAG |
| STABILITY | 52 | 54 | -2NEUTRAL |
| SHORT INT | 45 | 42 | +3NEUTRAL |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROE proxy 14.2% (sector 5.7%)
GM 79% vs sector 65%, OM 9% vs sector 5%
Capital turnover N/A, R&D intensity 20.8%
Rev growth 11%, 8yr history
Interest coverage 130.5x, Net debt/EBITDA -6.8x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate DOCUSIGN, INC. (DOCU) as a Reduce with a composite score of 47.6/100 at a current price of $42.80. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential.
DOCUSIGN, INC. holds a top-quartile position (#0 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 47.6/100 places it at rank #2396 in our full universe.
Narrow
High
Poor
Fair Value
Gross margins of 79% signal strong pricing power.
Stable competitive position in a defensive sector.
Leverage of 101% D/E amplifies downside risk.
Weak momentum suggests persistent institutional selling pressure.
Vulnerability to macroeconomic shocks and interest rate volatility.
DOCUSIGN, INC. represents a reduce based on multi-factor quantitative performance.
DOCUSIGN, INC. receives a Reduce rating from our analysis, with a composite score of 47.6/100 and 2 out of 5 stars, ranking #2396 out of 7,333 stocks. DOCU's factor profile shows weakness across multiple dimensions, suggesting the stock may underperform going forward. Existing holders may want to consider trimming positions or tightening stop-losses.
DOCU earns a quality score of 69/100, indicating above-average business quality. The company reports a return on equity of 14.2% (sector avg: 5.7%), gross margins of 79.3% (sector avg: 64.6%), net margins of 8.9% (sector avg: 2.8%). Companies in this tier generally demonstrate consistent profitability and efficient capital deployment, though they may face some competitive pressure.
DOCU's value score of 54/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 31.68x, an EV/EBITDA of 33.01x, a P/B ratio of 4.50x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
With an investment score of 41/100, DOCU exhibits moderate growth-oriented spending. Key growth metrics include revenue growth of 11.2% vs. a sector average of 8.6% and a return on assets of 7.1% (sector: 2.4%). The company appears to be balancing growth investments with capital returns, though the pace of investment may not be enough to accelerate top-line growth meaningfully.
DOCUSIGN, INC. is experiencing notably weak momentum with a score of just 27/100. The stock has underperformed its peers and is trending below major moving averages. Revenue growth stands at 11.2% year-over-year, while a beta of 1.30 reflects its sensitivity to broader market moves. While deep momentum weakness can occasionally present value opportunities, it often reflects deteriorating fundamentals or structural headwinds that may persist.
With a stability score of 52/100, DOCU exhibits average financial resilience. Key stability metrics include a beta of 1.30 and a debt-to-equity ratio of 101.00x (sector avg: 0.3x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
The short interest score of 45/100 for DOCU suggests somewhat elevated bearish positioning by institutional traders. Specific risk factors include above-average market sensitivity (beta: 1.30), elevated leverage (D/E: 101.00x). With a $14.7B market cap (large-cap), DOCUSIGN, INC. may experience above-average volatility. Investors should consider whether the short thesis has merit or if it creates a potential short-squeeze opportunity.
DOCUSIGN, INC. is a large-cap company in the Services sector, ranked #0 of 50 in its sector (100th percentile) and #2396 of 7,333 overall (67th percentile). Key comparisons include ROE of 14.2% exceeding the 5.7% sector median and operating margins of 8.6% above the 4.5% sector average. This top-quartile standing reflects exceptional competitive strength relative to Services peers.
While DOCU currently exhibits a REDUCE profile, superior opportunities exist within the SERVICES sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
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Improvement in Momentum (27) would have the largest impact on the composite score.
EV/EBITDA 181% ABOVE SECTOR MEDIAN
ROE 147% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 23% ABOVE SECTOR MEDIAN (FAVORABLE)
DocuSign (NASDAQ:DOCU) shareholders have experienced a significant loss, with the stock price dropping 77% over the past five years and 43% in the last year alone. Despite this poor share price performance, the company has transitioned from a loss to profitability, and its revenue has grown by 14% over the same five-year period. This suggests that a deeper look into the fundamentals beyond the share price momentum may be warranted to understand the disparity.
DocuSign (NASDAQ: DOCU) shares plummeted to a 52-week low after Jefferies downgraded the stock from Buy to Hold and significantly cut its price target from $105 to $45. This downgrade, coupled with a broader market downturn and negative technical indicators like being below major moving averages, contributed to the stock's 7.38% drop. Despite an oversold RSI and a bullish MACD crossover hinting at short-term upside, DocuSign faces significant challenges as indicated by its weak momentum rank.
DocuSign Inc. (NASDAQ:DOCU) is highlighted as a compelling value case for investors, identified through a systematic filtering process that combines strong basic valuation with acceptable ratings in growth, profitability, and financial health. Despite a neutral overall rating, DocuSign's low P/E ratio and strong cash flow metrics suggest it is undervalued compared to its industry. The article emphasizes that while its growth may be slowing, the company maintains good profitability and a debt-free balance sheet, making it worthy of further investigation by value-focused investors.
Docusign (NASDAQ:DOCU) recently hit a new 52-week low, trading as low as $51.63, with analysts issuing "Hold" ratings and trimming price targets. Insider selling of shares has also occurred, raising concerns even though the consensus price target is $85.13. The article advises potential investors to consider other top-rated stocks identified by analysts, as Docusign was not on their buy list.
Major Wall Street indexes were slightly higher on Friday, supported by economic data suggesting potential Federal Reserve interest rate cuts. Netflix announced a deal to acquire Warner Bros. Discovery, while Adobe surged and other companies like Ulta Beauty reported strong earnings.
Above 50MA
37.18%
Net New Highs
+51081