Assessing DocuSign Shares After AI Integration News and Ongoing Momentum in 2025

Thinking about whether to buy, hold, or sell DocuSign stock? You are not alone. Over the last twelve months, shares have delivered an impressive 44.6% return, which feels like a comeback after some tough years. If you zoom out, though, the five-year return is still down 60.2%, a sobering reminder of the volatility many tech stocks face once the initial hype fades. Still, it is hard to miss the positive momentum lately as the stock rose 3.8% just in the last week and 13.4% over the past month. It is clear the market is re-evaluating DocuSign, possibly reflecting changing expectations about growth and risk in the e-signature market as the sector matures and competitors shuffle for position.

With a value score of 2 out of 6, DocuSign shows up as undervalued on a couple of traditional measures, but there is still a lot for investors to unpack. How should you make sense of this mixed bag? Let us dig into the most important valuation methods, and stick around as I also share what savvy investors are watching beyond the numbers.

DocuSign scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: DocuSign Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company's intrinsic value by projecting its future cash flows and discounting them back to today's dollars. This approach provides an idea of what the business is truly worth, independent of market hype or short-term sentiment.

For DocuSign, the latest reported Free Cash Flow (FCF) is $938.4 Million. Analysts expect this to grow steadily, with forecasts projecting annual FCF to reach around $1.19 Billion by 2030. While analysts directly estimate cash flows for the next five years, further out projections are generated mathematically from historical growth rates. All figures discussed are based on US dollars.

Based on the current model, DocuSign's estimated intrinsic value is $97.91 per share. Compared to its current share price, this represents a 13.4% discount, suggesting the stock may be undervalued at today's levels.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for DocuSign.

Our Discounted Cash Flow (DCF) analysis suggests DocuSign is undervalued by 13.4%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: DocuSign Price vs Earnings

The Price-to-Earnings (PE) ratio is the preferred multiple for analyzing profitable companies like DocuSign because it relates the share price directly to the underlying earnings, giving a quick snapshot of how the market values the company’s profits. It is especially useful when a business has positive and stable earnings, as is the case with DocuSign.

Growth expectations and risk levels both play a significant role in determining what a “normal” or “fair” PE ratio should be. A company with higher anticipated growth or lower risks often commands a higher PE ratio, as investors are willing to pay more for each dollar of current earnings. Conversely, slower-growing or riskier companies tend to trade at lower multiples.

DocuSign currently trades at a PE ratio of 60.7x. This is noticeably higher than the Software industry average of 36.2x, and above the peer average of 73.9x. Simply Wall St’s proprietary “Fair Ratio” for DocuSign stands at 35.3x, which reflects a more nuanced benchmark. It accounts not only for growth and profit margins, but also the company’s size, industry, and risk profile. This tailored approach can be more informative than simply comparing to the broader sector or peer group, especially for companies with unique growth or risk characteristics.

Comparing DocuSign’s current PE ratio of 60.7x to its Fair Ratio of 35.3x suggests the stock is trading at a premium and may be overvalued based on this method.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your DocuSign Narrative

Earlier, we mentioned there is an even better way to understand valuation. Let us introduce you to Narratives. A Narrative is your own investment story, a perspective on DocuSign that combines your expectations for future revenue, profits, and margins with a reasoned view of what the company is truly worth. Instead of just relying on ratios or analyst targets, Narratives let you anchor a fair value to your personal forecast, grounded in the real drivers that matter most to you.

This approach bridges a company’s unique story and qualitative outlook directly into a quantitative forecast, so your decisions are supported by both insight and numbers. Narratives are easy to create with a few clicks on Simply Wall St’s Community page, used by millions of investors worldwide. By seeing your estimated Fair Value alongside today’s market price, you can quickly spot opportunities or risks. Since Narratives automatically update as news or earnings are released, your view is always current.

For example, some investors believe DocuSign will unlock new global opportunities and set a Fair Value as high as $124.00 per share, while others focus on competition risks and are more cautious, estimating a Fair Value around $77.00. Narratives help you explore and compare these different perspectives to refine your own investment decisions.

Do you think there's more to the story for DocuSign? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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