Shares of DocuSign are up Friday morning following the company’s fiscal first-quarter earnings. Among those who came away impressed are analysts are Wedbush, who raised their price target for the company to $67 from $60 and maintained their Neutral rating.
"Last night DocuSign delivered strong Jokic-like FY1Q24 results featuring beats on the top and bottom-line with the company demonstrating continued durability of its core technology moat and leverage in its operating model despite the difficult operating environment,” analysts wrote, referencing the Denver Nuggets two-time MVP currently playing in the NBA Finals.
Shares of DocuSign rose 6.7% Friday to $62.40.
The digital contract provider posted revenue of $661.4 million, up 12% year-over-year and topping Street expectations of $641.7 million. Subscription revenue was $639.3 million, higher than the company’s guidance range of $625 million to $629 million and analyst projections of $627.1 million.
“[DocuSign] executes on its go-to-market strategy which includes innovating products for improved workflows and a release of new products for the entire agreement journey,” analysts wrote. “... [T]he product portfolio continues its innovation plan which includes the implementation of generative AI solutions into its product portfolio to expand its market reach across all verticals.”
The company’s second quarter revenue guidance of $675 million to $679 million is slightly lower than the Street’s $667.7 million projection, which the analysts said reflects a “moderating customer pipeline and customer buying behavior.”
That said, Wedbush is optimistic.
“We view this quarter as a step in the right direction towards regaining the Street’s confidence as DOCU is starting to turn the corner on its profitable growth strategy while investing in the long-term,” analysts wrote. “We maintain our NEUTRAL rating while raising our price target from $60 to $67 reflecting our increased confidence in the DOCU story going forward.”
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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