DocuSign shares fall after Piper Sandler downgrade
July 22, 2022
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DocuSign ($NASDAQ:DOCU) shares fell after Piper Sandler analyst Rob Owens downgraded the stock to underweight from neutral and cut the price target to $54 from $65. Owens cited risks associated with the transition to a new CEO, “consistent” execution challenges, continued employee turnover and an economy that looks increasingly challenging. It is unclear how significant of an impact this downgrade will have on DocuSign’s market and earnings in the long term.
However, it is worth noting that Piper Sandler is not the only firm to have expressed concerns about the company’s recent performance. In December, J.P. Morgan analyst Brad Sills downgraded DocuSign to neutral from overweight, citing execution risk and increased competition.
Market Reaction
Most news outlets released mixed reviews of the downgrade.
However, on Thursday, DOCUSIGN stock opened at $65.0 and closed at $67.5.
VI Analysis
The company’s fundamentals reflect its long term potential. The below analysis on DOCUSIGN is made simple by the VI app. Based on the VI Risk Rating, DOCUSIGN is a medium risk investment in terms of financial and business aspects. You may check out what are the business and financial areas presenting potential risks in our website.
Summary
Piper Sandler downgraded DocuSign’s stock from overweight to neutral on Monday, citing mixed news about the company’s business prospects.
However, Piper Sandler analyst Brent Bracelin said in a research note that the acquisition is a “head scratcher,” as it doesn’t appear to be a strategic fit for DocuSign. Bracelin also noted that DocuSign is facing increased competition from Adobe, which recently launched its own e-signature service. Despite the mixed news, Bracelin said that DocuSign remains a “leader in e-signatures” and that the company’s shares are still attractively priced.
