Is DocuSign (DOCU) Undervalued After Its Recent Share Price Slide? A Fresh Look at the Valuation

DocuSign (DOCU) has been a tough hold lately, with the stock down around 28% over the past year even as revenue and net income keep growing, which raises a simple question for investors.

See our latest analysis for DocuSign.

That slide reflects fading short term momentum, with a roughly 20% 90 day share price return decline and a 1 year total shareholder return of about negative 28%, even though longer term holders still sit on a positive 3 year total shareholder return.

If DocuSign has you rethinking where growth and risk feel balanced, it could be worth scanning high growth tech and AI stocks for other tech names shaping the next wave of digital workflows.

With shares lagging despite solid top line and earnings growth, and the stock trading at a notable discount to analyst targets and intrinsic value, is DocuSign quietly becoming a contrarian opportunity, or is the market correctly pricing in slower future growth?

Most Popular Narrative: 22.9% Undervalued

With the narrative fair value sitting well above DocuSign’s recent close at $67.79, the story leans toward meaningful upside if its assumptions land.

Operational efficiency initiatives including automation, cloud migration, AI driven R&D investment, and measured hiring are sustaining strong free cash flow generation, supporting robust capital returns (e.g., buybacks) and setting the stage for net margin and EPS expansion as cloud migration costs ease in the coming fiscal year.

Read the complete narrative.

Curious how steady mid single digit growth, rising margins, and a premium future earnings multiple can still add up to upside from here? Read how this narrative connects modest revenue assumptions, expanding profitability, and shrinking share count into a valuation path that challenges today’s cautious market view.

Result: Fair Value of $87.88 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slowing core eSignature growth and intensifying competition could pressure DocuSign’s pricing power and margins, which may challenge the optimistic rerating embedded in this narrative.

Find out about the key risks to this DocuSign narrative.

Build Your Own DocuSign Narrative

If this framing does not quite fit your view, or you prefer digging into the numbers yourself, you can build a personalized narrative in just a few minutes: Do it your way.

A great starting point for your DocuSign research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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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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