DocuSign Stock Is Sinking. Analysts Explain Why.

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The near-term outlook seems challenging says RBC Capital Markets.

Tiffany Hagler-Geard/Bloomberg

Shares of technology company

which provides electronic signature software, were falling early Thursday as analysts said prospects for profitability are disappointing.


(ticker: DOCU) fell 19% in early trading at $51.91. The stock is down 5.49% this year.

Investors were hoping that margins would be improving more quickly after the company announced a 10% reduction in staff last month. That followed layoffs of some 9% of staff in September. 

J.P. Morgan analyst Mark Murphy downgraded the stock to Underperform from Neutral and lowered the price target to $48 from $58.

Others were also pessimistic about DocuSign’s prospects, even though results seemed solid. The company beat expectations for fourth-quarter earnings, and guidance for first-quarter revenue was in line.

“The near-term outlook seems challenging,” said RBC Capital Markets analysts led by Rishi Jaluria. Investors expected the “reduction in the workforce since September to lead to a better margin.”

RBC gives the shares a price target of $59 and a rating of Sector Perform.

Write to Brian Swint at


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