DocuSign, Inc. provides electronic signature solution in the United States and internationally. The company provides e-signature solution that enables sending and signing of agreements on various devices; Contract Lifecycle Management (CLM), which automates workflows across the entire agreement process; Document Generation streamlines the process of generating new, custom agreements; and Gen for Salesforce, which allows sales representatives to automatically generate agreements with a few clicks from within Salesforce. It also provides Identify, a signer-identification option for checking government-issued IDs; Standards-Based Signatures, which support signatures that involve digital certificates; Monitor that uses advanced analytics to track DocuSign eSignature web, mobile, and API account; Notary which enables notaries public to conduct remote online notarization transactions; and Web Forms, a web forms that quickly draft agreements using pre-populated data from completed forms or external systems via APIs. In addition, the company offers Rooms for Real Estate that provides a way for brokers and agents to manage the entire real estate transaction digitally. Signature and CLM are FedRAMP, an authorized version of DocuSign eSignature for U.S. federal government agencies; and life sciences modules that support compliance with the electronic signature practices. The company sells its products through direct and partner-assisted sales, and digital self-service purchasing. DocuSign, Inc. was incorporated in 2003 and is headquartered in San Francisco, California.

DocuSign, Inc.

Adobe ADBE shares closed at $365.79 on Friday, roughly 38% below the 52-week high of $587.75 it hit on Sept. 12, 2024. ADBE shares have appreciated 17.7% year to date (YTD), underperforming the Zacks Computer and Technology sector’s return of 9.6% and the Zacks Computer – Software industry’s return of 19%.
Since June 12, when Adobe reported its second-quarter fiscal 2025, shares dropped 11.5%. The drop reflects modest revenue growth prospects in the near term, as the company continues to face stiff competition in the AI and generative AI (GenAI) space from the likes of Microsoft MSFT-backed OpenAI, as well as a lack of monetization of its AI solutions.
Adobe’s AI business is minuscule compared with the likes of Microsoft and Alphabet GOOGL. Microsoft’s Intelligent Cloud revenues are benefiting from growth in Azure AI services and a rise in AI Copilot business. Alphabet’s focus on leveraging AI to drive growth is a key catalyst. AI is infused heavily across its offerings, including Search, Google Cloud and Pixel. Adobe is also facing stiff competition from DocuSign DOCU in the document services & e-signature domain.
However, second-quarter fiscal 2025 results indicated that Adobe is catching up through the expansion of its AI portfolio with GenStudio and Firefly Services. Adobe’s AI book of business from AI-first products, including Acrobat AI assistant, Firefly App and Services and GenStudio for Performance Marketing, is tracking ahead of the $250 million ending Annual Recurring Revenue (ARR) target by the end of fiscal 2025. The company exited the fiscal second quarter with Digital Media ARR of $18.09 billion, up 12% year over year.
ADBE Stock’s Performance
Image Source: Zacks Investment Research
However, Adobe shares are overvalued, as suggested by a Value Score of C.
Adobe shares are now trading below the 50-day and 200-day moving averages, indicating a bullish trend.
ADBE Trades Below the 50-Day and 200-day SMAs
Image Source: Zacks Investment Research
So, what should investors do with Adobe shares? Let’s dig deep to find out.
Adobe’s Innovative Portfolio Boosts Prospects
Adobe’s tools, like Acrobat AI Assistant and Adobe Express, are attracting business professionals and creators. Acrobat AI Assistant uses conversational interfaces to make it easier for users to read digital documents and gain insights within a short timeframe. Adobe Express is using AI to enable consumers to quickly design and publish content through conversational AI in an easy-to-use, all-in-one application. Adobe is integrating these solutions to facilitate a smoother creation-to-consumption process across mobile apps, web browsers and desktop offerings. Adobe’s monthly active users across these categories surpassed more than 700 million users at the end of the second quarter of fiscal 2025.
Adobe’s strategy of offering an AI-powered, comprehensive creative platform that extends from idea generation through creation to mass production and delivery is addressing the needs of Creative and Marketing Professionals. Firefly is enhancing the capabilities of Creative Cloud desktop applications. The Firefly App is attracting users for AI-powered content ideation, creation and production, and its support for third-party models, including from Alphabet division Google’s Imagen and Veo, Microsoft-backed OpenAI’s image generation and Black Forest Labs’ Flux, is a key catalyst. Adobe Firefly App availability on mobile is expected to further boost its popularity.
Adobe is leveraging Adobe Experience Platform (AEP) and native applications to deliver unified and personalized customer experiences. The launch of AEP AI assistant enables teams across the business to interact with data smoothly and efficiently. The innovative solution helps customers leverage their first-party customer data and deliver more relevant high-impact advertising experiences driven by direct customer relationships.
Adobe Offers Positive Guidance
Adobe now expects fiscal 2025 revenues between $23.5 billion and $23.6 billion ($21.51 billion in fiscal 2024), up from the previous guidance range of $23.3-$23.55 billion. Fiscal 2025 non-GAAP earnings are now expected between $20.50 per share and $20.70 per share ($18.42 per share in fiscal 2024), higher than the previous guidance of $20.20-$20.50 per share.
For fiscal 2025, Digital Media Annual Recurring Revenue is still expected to grow 11% year over year. Digital Media segment revenues are expected to be between $17.45 billion and $17.50 billion. Digital Experience segment revenues are expected between $5.8 billion and $5.9 billion, while Digital Experience subscription segment revenues are expected between $5.375 billion and $5.425 billion.
For fiscal 2025, the Zacks Consensus Estimate for earnings is pegged at $20.60 per share, up by 14 cents over the past 30 days. The figure indicates 11.83% growth over fiscal 2024.
Adobe Inc. Price and Consensus
The Zacks Consensus Estimate for third-quarter fiscal 2025 earnings is pegged at $5.16 per share, up 1.8% over the past 30 days, suggesting 10.97% growth from the year-ago quarter.
Conclusion
Adobe’s focus on improving monetization of its AI tools is a positive for investors despite a premium valuation and stiff competition. ADBE currently has a Zacks Rank #2 (Buy) and a Growth Score of B, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Adobe Trades 38% Below 52-Week High: Right Time Buy the ADBE Stock?

DocuSign DOCU is redefining agreement management with its Intelligent Agreement Management (IAM) platform, an AI-driven solution that has quickly become the fastest-growing new product in the company’s history. Positioned well beyond the scope of traditional e-signature tools, IAM represents a strategic evolution in how businesses manage the lifecycle of agreements.
A key strength of the IAM platform lies in its robust integration with enterprise leaders such as Microsoft MSFT and Salesforce PYPL. These partnerships are not merely symbolic; they are deeply embedded within the company’s vision of enabling seamless, intelligent workflows across the tools organizations already rely on. Whether a user is drafting a contract within Microsoft Word or managing customer relationships in Salesforce’s CRM, IAM ensures documents move efficiently and securely through automated processes.
The Microsoft integration enables professionals to initiate, track, and manage agreements directly from Microsoft 365 applications, thereby eliminating workflow disruptions and enhancing operational efficiency. Similarly, the Salesforce integration enables sales, legal and procurement teams to collaborate effortlessly within the CRM environment, improving visibility and reducing turnaround time for agreements. These integrations strengthen customer dependency, effectively anchoring the IAM platform within the core infrastructure of large enterprises. This strategic alignment not only increases the platform’s reach but also significantly improves user retention.
IAM underscores DocuSign’s broader transition into a comprehensive digital agreement platform, designed to support every stage of the contract lifecycle, from creation and negotiation to execution and analysis. With AI-driven insights, the platform enhances decision-making, speeds up workflows and reinforces compliance and accuracy.
By embedding itself within widely used enterprise ecosystems, DocuSign is building a level of stickiness that’s hard to displace. This strategic positioning makes IAM not just a useful tool but a mission-critical component of digital transformation initiatives. As more organizations embrace automation and intelligent workflows, DocuSign’s IAM, driven by advanced integrations and AI, is emerging as a cornerstone of the future-forward enterprise.
DOCU’s Price Performance, Valuation, Estimates
The stock has declined 12% year to date compared with the industry’s 16% rally.
Image Source: Zacks Investment Research
From a valuation standpoint, DOCU trades at a forward price-to-earnings ratio of 21.73, well above the industry’s 40.18. It carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for DOCU’s second-quarter fiscal 2025 earnings has been on the rise over the past 60 days.
Image Source: Zacks Investment Research
DOCU stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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DocuSign's IAM: Automating Agreements, Redefining Enterprise

Below is Validea's guru fundamental report for DOCUSIGN INC (DOCU). Of the 22 guru strategies we follow, DOCU rates highest using our P/B Growth Investor model based on the published strategy of Partha Mohanram. This growth model looks for low book-to-market stocks that exhibit characteristics associated with sustained future growth.
DOCUSIGN INC (DOCU) is a large-cap growth stock in the Software & Programming industry. The rating using this strategy is 100% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
Detailed Analysis of DOCUSIGN INC
More Information on Partha Mohanram
About Partha Mohanram: Sometimes the best investing strategies don't come from the world of investing. Sometimes research that changes the investing world can come from the halls of academia. Partha Mohanram is a great example of this. While academic research has shown that value investing works over time, it has found the opposite for growth investing. Mohanram turned that research on its head by developing a growth model that produced significant market outperformance. His research paper "Separating Winners from Losers among Low Book-to-Market Stocks using Financial Statement Analysis" looked at the criteria that can be used to separate growth stocks that continue their upward trajectory from those that don't. Mohanram is currently the John H. Watson Chair in Value Investing at the University of Toronto and was previously an Associate Professor at the Columbia Business School.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Guru Fundamental Report for DOCU

Docusign (NASDAQ: DOCU) and Confluent (NASDAQ: CFLT) both help companies streamline their businesses with their cloud-based services. Docusign is the world's largest provider of e-signature services, while Confluent's platform processes real-time data as it flows between different applications across an organization.
But over the past 12 months, Docusign's stock price rose 44% as Confluent's stock slumped 13%. Let's see why the e-signature services leader outperformed the "data in motion" company by such a wide margin -- and if it will remain the better investment over the next few years.
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The differences between Docusign and Confluent
Docusign serves over 1.4 million customers in 180 countries, and it's been used in more than a billion transactions. It generates most of its revenue from subscriptions to its e-signature platform, its contract lifecycle management (CLM) tools, and other cloud-based services.
Confluent served 6,140 customers in its latest quarter. Its namesake platform runs on Apache Kafka, an open-source platform for streaming data, but it adds additional analytics tools to differentiate itself from other "Kafka-as-a-service" providers. It generates its revenue from a mix of subscriptions and more flexible consumption-based fees.
Which company is growing faster?
Docusign's growth is driven by the growing usage of digital documents and e-signatures as they replace their pen-and-paper counterparts. Confluent's growth is fueled by a need to evaluate data as it streams across the silos of a large organization. That real-time analysis gets everyone on the same page to make faster decisions.
From fiscal 2021 to fiscal 2025 (which ended this January), Docusign's revenue grew at a CAGR of 20% as its adjusted gross margin rose from 79% to 82%. It also turned profitable on a generally accepted accounting principles (GAAP) basis over the past two fiscal years as it downsized its workforce and streamlined its spending.
But from fiscal 2025 to fiscal 2028, analysts expect Docusign's revenue to grow at a slower CAGR of 8% as its core market matures, it laps some earlier-than-expected contract renewals from fiscal 2024, cautiously expands its new AI-driven Intelligent Agreement Management (IAM) platform, and deals with tougher competitive and macro headwinds.
Analysts expect its GAAP EPS to decline in fiscal 2026 as it expands its lower-margin IAM platform while lapping some big buybacks and one-time tax benefits. But over the following two years, they expect its EPS to grow at a CAGR of 41% as it scales up its IAM platform and streamlines its spending.
From 2020 to 2024, Confluent's revenue rose at a CAGR of 42% as its adjusted gross margin expanded from 70% to 79%. That growth was driven by the accelerating adoption of real-time data streaming services (especially among larger enterprise customers), the expansion of its higher-margin cloud-based ecosystem with more analytics tools, and its new overseas customers. But it's still never been profitable on a GAAP basis.
From 2024 to 2027, analysts expect its revenue to grow at a CAGR of 19% as it gradually narrows its net losses. Its biggest potential catalysts include the growth of its cloud platform, fresh tailwinds from the booming AI market, and the expansion of its enterprise and overseas businesses.
Which stock is a better value right now?
Docusign's stock trades at 61 times forward earnings and 5 times this year's sales. Confluent can't be valued by its profits, but it trades at 7 times this year's sales.
However, Docusign's insiders sold nearly 2.1 million shares over the past 12 months while only buying around 1,300 shares. Confluent's insiders bought 17.2 million shares and sold 17.6 million shares during the same period. That warmer insider sentiment suggests that Confluent might have a bit more upside potential than Docusign.
The better buy: Confluent
Docusign's stock rose over the past year as the bulls cheered the growth potential of its IAM platform in the AI market, but it's still being valued as a growth stock as its core business matures. Confluent should continue growing at a faster rate as its cloud platform expands, and its stock seems more reasonably valued relative to its growth potential.
I wouldn't rush to buy either of these cloud-oriented stocks right now. But if I had to choose one over the other, I'd probably avoid Docusign and bet on a stronger recovery for Confluent -- which stands to process a lot more streaming data as the cloud and AI markets expand.
Should you invest $1,000 in Docusign right now?
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Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Docusign. The Motley Fool recommends Confluent. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Better Cloud Stock: Docusign vs. Confluent

Below is Validea's guru fundamental report for DOCUSIGN INC (DOCU). Of the 22 guru strategies we follow, DOCU rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum and price momentum.
DOCUSIGN INC (DOCU) is a large-cap value stock in the Software & Programming industry. The rating using this strategy is 94% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
FUNDAMENTAL MOMENTUM:
PASS
TWELVE MINUS ONE MOMENTUM:
PASS
FINAL RANK:
PASS
Detailed Analysis of DOCUSIGN INC
DOCU Guru Analysis
DOCU Fundamental Analysis
More Information on Dashan Huang
Dashan Huang Portfolio
About Dashan Huang: Dashan Huang is an Assistant Professor of Finance at the Lee Kong Chian School of Business at Singapore Management University. His paper "Twin Momentum" looked at combining traditional price momentum with improving fundamentals to generate market outperformance. In the paper, he identified seven fundamental variables (earnings, return on equity, return on assets, accrual operating profitability to equity, cash operating profitability to assets, gross profit to assets and net payout ratio) that he combined into a single fundamental momentum measure. He showed that stocks in the top 20% of the universe according to that measure outperformed the market going forward. When he combined that measure with price momentum, he was able to double its outperformance.
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

DOCU Quantitative Stock Analysis

Adobe ADBE shares have dropped 8.6% since the company reported second-quarter fiscal 2025 results on Thursday (June 12) last week. The drop reflects modest revenue growth prospects in the near term, as the company continues to face stiff competition in the AI and generative AI (GenAI) space from the likes of Microsoft MSFT-backed OpenAI, as well as a lack of monetization of its AI solutions.
Adobe’s AI business is minuscule compared with the likes of Microsoft and Alphabet GOOGL. Microsoft’s Intelligent Cloud revenues are benefiting from growth in Azure AI services and a rise in AI Copilot business. Alphabet’s focus on leveraging AI to drive growth is a key catalyst. AI is infused heavily across its offerings, including Search, Google Cloud and Pixel. Adobe is also facing stiff competition from DocuSign DOCU in the document services & e-signature domain.
However, second-quarter fiscal 2025 results indicated that Adobe is catching up through the expansion of its AI portfolio with GenStudio and Firefly Services. Adobe’s AI book of business from AI-first products, including Acrobat AI assistant, Firefly App and Services and GenStudio for Performance Marketing, is tracking ahead of the $250 million ending Annual Recurring Revenue (ARR) target by the end of fiscal 2025. The company exited the fiscal second quarter with Digital Media ARR of $18.09 billion, up 12% year over year.
ADBE Stock’s Performance
Image Source: Zacks Investment Research
Is this encouraging enough for investors to buy Adobe shares? Let’s dig deep to find out.
Solid Q2 Results and Positive Fiscal 2025 View Good for ADBE
Adobe reported second-quarter fiscal 2025 non-GAAP earnings of $5.06 per share, which beat the Zacks Consensus Estimate by 2.02% and increased 12.9% year over year. Total revenues were $5.87 billion, which beat the consensus mark by 1.50% and increased 11% year over year on a reported basis and a constant-currency (cc) basis.
Digital Media revenues were $4.35 billion (74% of total revenues), up 11% year over year on a reported basis and 12% on a cc basis. The figure surpassed the Zacks Consensus Estimate by 1.77%. Business Professionals and Consumers' group subscription revenues were $1.60 billion, 15% year over year. Creative and Marketing Professionals Group subscription revenues were $4.02 billion, 10% year over year.
Digital Experience revenues of $1.46 billion (25% of total revenues) increased 10% year over year, both on a reported and cc basis. The figure beat the consensus mark of 1.56%. The company’s growth was driven by a strong demand for Customer Experience Orchestration solutions, which integrate content, data and journeys, as well as AI-infused tiered offerings like Adobe Experience Platform and GenStudio for Performance Marketing.
Adobe now expects revenues between $23.5 billion and $23.6 billion ($21.51 billion in fiscal 2024), up from the previous guidance range of $23.3-$23.55 billion. Fiscal 2025 non-GAAP earnings are now expected between $20.50 per share and $20.70 per share ($18.42 per share in fiscal 2024), higher than the previous guidance of $20.20-$20.50 per share.
For fiscal 2025, Digital Media Annual Recurring Revenue is still expected to grow 11% year over year. Digital Media segment revenues are expected to be between $17.45 billion and $17.50 billion. Digital Experience segment revenues are expected between $5.8 billion and $5.9 billion, while Digital Experience subscription segment revenues are expected between $5.375 billion and $5.425 billion.
ADBE’s Fiscal 2025 Estimate Revision Shows Upward Trend
For fiscal 2025, the Zacks Consensus Estimate for earnings is pegged at $20.60 per share, up by 14 cents over the past 30 days. The figure indicates 11.83% growth over fiscal 2024.
The Zacks Consensus Estimate for third-quarter fiscal 2025 earnings is pegged at $5.16 per share, up 1.8% over the past 30 days, suggesting 10.97% growth from the year-ago quarter.
Adobe Inc. Price and Consensus
Adobe Inc. price-consensus-chart | Adobe Inc. Quote
Adobe’s Innovative Portfolio Boosts Prospects
Adobe’s tools, like Acrobat AI Assistant and Adobe Express, are attracting business professionals and creators. Acrobat AI Assistant uses conversational interfaces to make it easier for users to read digital documents and gain insights within a short timeframe. Adobe Express is using AI to enable consumers to quickly design and publish content through conversational AI in an easy-to-use, all-in-one application. Adobe is integrating these solutions to facilitate a smoother creation-to-consumption process across mobile apps, web browsers and desktop offerings. Adobe’s monthly active users across these categories surpassed more than 700 million users at the end of the second quarter of fiscal 2025.
Adobe’s strategy of offering an AI-powered, comprehensive creative platform that extends from idea generation through creation to mass production and delivery is addressing the needs of Creative and Marketing Professionals. Firefly is enhancing the capabilities of Creative Cloud desktop applications. The Firefly App is attracting users for AI-powered content ideation, creation and production, and its support for third-party models, including from Alphabet division Google’s Imagen and Veo, Microsoft-backed OpenAI’s image generation and Black Forest Labs’ Flux, is a key catalyst. Adobe Firefly App availability on mobile is expected to further boost its popularity.
Adobe Stock Trades at a Premium
Adobe shares are also overvalued, as suggested by a Value Score of D.
ADBE stock is trading at a premium, with a forward 12-month price/sales of 6.54X compared with the broader Zacks Computer and Technology sector’s 6.36X, Alphabet’s 6.13X and DocuSign's 4.71X.
Price/Sales Ratio (F12M)
Image Source: Zacks Investment Research
Conclusion
Adobe’s focus on improving monetization of its AI tools is a positive for investors despite a premium valuation and stiff competition. ADBE currently has a Zacks Rank #2 (Buy) and a Growth Score of A, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Adobe Drops 9% Post Q2 Results: Should You Buy the Stock on the Dip?

Docusign (NASDAQ: DOCU) stock soared to a peak of $310 in 2021 on the back of an incredible spike in demand for the company's suite of digital document tools, which helped businesses keep their operations running smoothly in the face of the pandemic's lockdowns and social distancing restrictions.
Since that pandemic tailwind subsided, the stock has slumped by 75% from that peak, but the business itself is still generating steady revenue growth, and its profits are currently soaring. Plus, Docusign is experiencing strong demand for its new Intelligent Agreement Management (IAM) platform, which is powered by artificial intelligence (AI).
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On June 6, Docusign reported results for its fiscal 2026 first quarter (which ended April 30), and management increased its full-year revenue guidance, which signals clear momentum across the business. Here's why investors might want to buy the stock now.
IAM could transform contract management
Docusign transformed its product portfolio over the past year. It still helps businesses create, negotiate, and close contracts, but AI is now at the center of that mission. The IAM platform is designed to solve the "agreement trap" more effectively. According to a study by Deloitte, the inefficiencies caused by poor contract management processes result in $2 trillion in lost economic value every year. That represents a massive opportunity for Docusign.
IAM features a growing list of revolutionary products. Navigator, for example, is a digital repository where businesses can store their agreements. It uses AI to extract critical details from each document so they are discoverable via its search function, which saves employees from spending valuable time digging through contracts manually.
Then there is AI-Assisted Review, which can help employees rapidly identify problematic clauses or even opportunities within each agreement. Businesses can also set pre-approved standards so the tool knows exactly what to look for, which reduces the time it takes to reach a final deal.
Maestro ties the IAM platform together with a series of no-code tools that allow businesses to automate agreement workflows. They can drag-and-drop features like webforms, ID verification, and eSignature into each contract, which saves significant amounts of time and money compared to manual processes, especially when creating agreements at scale.
At the end of its first quarter of fiscal 2026, Docusign had 1.7 million paying enterprise customers and more than 1 billion individual users. The company launched the IAM platform in April 2024, and it already has 10,000 paying enterprise customers who have used it to process tens of millions of agreements so far. During the quarter, IAM sales in international markets soared by 50% compared to fiscal 2025 Q4, which highlights the platform's serious momentum.
Steady revenue growth, and soaring profits
Docusign generated $763.7 million in total revenue during fiscal Q1. That was an 8% increase from the year-ago period, and comfortably above the $749 million that had been the high end of management's guidance range.
In fact, the strong result prompted the company to revise its revenue forecast for fiscal 2026 upward by $22 million to $3.163 billion at the high end of the range.
In my opinion, Docusign could be growing its revenue more quickly, but it's carefully managing its costs to improve its bottom line rather than investing more heavily in customer acquisition. The company's total operating expenses only increased by 1.6% year over year during the first quarter, which was a much slower rate than its revenue increased. As a result, its net income surged by 113.5% to $72.1 million on a GAAP (generally accepted accounting principles) basis.
Docusign also achieved a solid result in the bottom line on a non-GAAP basis, which excludes one-off and non-cash expenses like stock-based compensation. Non-GAAP net income came in at $190.8 million, which was an increase of 10% from the year-ago period.
Non-GAAP results can be particularly useful for investors to consider when a company incurs a large one-off benefit or expense. For example, during Docusign's fiscal 2025 second quarter, it reported a large one-off tax benefit worth $816 million which massively skewed its net income, so its GAAP earnings weren't a true reflection of the performance of its actual business.
Docusign stock is trading at an attractive valuation
When Docusign stock peaked in 2021, its price-to-sales (P/S) ratio soared to an unsustainable level of around 40. The 75% decline in its stock since then, combined with the company's steady revenue growth, has pushed its P/S ratio down to a more reasonable 5.4.
In fact, that's a 56% discount to its average P/S ratio of 12.5 since the stock went public in 2018.
Docusign also trades at a price-to-earnings (P/E) ratio of just 14.6, which makes it far cheaper than the S&P 500 index, which is trading at a P/E ratio of 23.3. However, that is based on Docusign's trailing 12-month GAAP earnings per share (EPS) which, as I mentioned earlier, was skewed by a one-off tax benefit from the second quarter of fiscal 2025.
Therefore, the P/S ratio might be a better way to value the stock right now, but no matter which way you slice it, Docusign's valuation appears attractive. The picture looks even better when you factor in the company's addressable market, which could be worth $50 billion according to an estimate issued by management last year. Based on its current revenue, it has barely scratched the surface of that opportunity.
In summary, Docusign stock can offer investors unique exposure to the AI revolution, and its combination of steady revenue growth and soaring profits could make it a great addition to any diversified portfolio at the current price.
Should you invest $1,000 in Docusign right now?
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Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Docusign. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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1 Magnificent Growth Stock Down 75% to Buy Hand Over Fist in June

DocuSign, Inc. DOCU reported impressive first-quarter fiscal 2026 results, wherein earnings per share (EPS) and revenues surpassed the Zacks Consensus Estimate.
However, the better-than-expected results failed to impress the investors, as the stock has lost 18.2% since the company released results on June 5.
Image Source: Zacks Investment Research
DOCU’s EPS (excluding 56 cents from non-recurring items) was 90 cents, which surpassed the Zacks Consensus Estimate by 11.1% and increased 9.8% from the year-ago quarter. Total revenues of $763.7 million beat the consensus mark by 2.2% and rose 7.6% from the first quarter of fiscal 2025.
The company’s shares have rallied 49.6% in the past year compared with the industry’s 37.3% rise and the Zacks S&P 500’s 10.8% growth.
Image Source: Zacks Investment Research
DOCU’s Segmental Revenues
Subscription revenues totaled $746.2 million, increasing 8% year over year. The figure beat our estimate of $730.4 million. Professional services and other revenues of $17.5 million fell 4% from the year-ago quarter, beating our expectation of $17 million. Billings amounted to $739.6 million, up 4% from the year-ago quarter. The figure failed to meet our anticipation of $748.7 million.
The non-GAAP gross margin was 82.3%, beating our estimate of 81.4%. The non-GAAP gross profit of $628.7 million grew 8% year over year and outpaced our expectation of $608.4 million. The non-GAAP operating margin was 29.5%, increasing 100 basis points from the year-ago quarter. It beat our estimate of 27.6%.
Balance Sheet & Cash Flow of DocuSign
DocuSign exited the first quarter of fiscal 2026 with cash and cash equivalents of $657.4 million compared with $817.4 million at the end of the first quarter of fiscal 2025. Net cash generated by operating activities was $251.4 million for the reported quarter. Free cash flow generated was $227.8 million.
DOCU’s Q1 & FY26 Guidance
For the second quarter of fiscal 2026, the company expects revenues between $777 million and $781 million. The mid-point of the guided range ($779 million) is above the Zacks Consensus Estimate of $777.7 million.
DOCU anticipates subscription revenues in the range of $760-$764 million and billing revenues between $757 million and $767 million. The non-GAAP gross margin and the non-GAAP operating margin are expected to be 80.5-81.5% and 26.5-27.5%, respectively.
For fiscal 2026, the company expects revenues between $3.15 billion and $3.16 billion. The Zacks Consensus Estimate for the same is $3.15 billion.
DOCU anticipates subscription revenues between $3.08 billion and $3.09 billion and billings between $3.29 billion and $3.34 billion. The non-GAAP gross margin and the non-GAAP operating margin are expected to be 80.7-81.7% and 27.8-28.8%, respectively.
Currently, DocuSign carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
Fiserv, Inc. FI reported mixed first-quarter 2025 results. The company’s earnings beat the Zacks Consensus Estimate, while revenues missed the mark.
FI’s adjusted earnings per share of $2.14 beat the consensus mark by 2.9% and gained 13.8% year over year. Adjusted revenues of $4.8 billion lagged the consensus estimate by 1.6% but rose 5.5% on a year-over-year basis. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
The Interpublic Group of Companies, Inc. IPG reported mixed first-quarter 2025 results. The company’s earnings topped the Zacks Consensus Estimate, while revenues missed the mark.
IPG’s adjusted earnings of 33 cents per share surpassed the Zacks Consensus Estimate by 10% but decreased 8.3% from the year-ago quarter. Revenues before billable expenses (net revenues) of $2 billion missed the consensus estimate by a slight margin and declined 20% year over year. Total revenues of $2.3 billion decreased 7.2% year over year but beat the Zacks Consensus Estimate of $2 billion.
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DOCU Shares Fall 18.2% Despite Q1 Earnings & Revenue Beat

Cognizant Technology Solutions CTSH shares have rallied 9% over the past month compared with the broader Zacks Computer & Technology sector’s increase of 8.8%. The outperformance can be attributed to an expanding clientele and a strong partner base. A favorable mix of business renewals and expansions of new opportunities is a major driver for Cognizant in 2025.
The company’s expanding partner base, which includes Pegasystems PEGA, Docusign DOCU, Omron OMRNY, NVIDIA, ServiceNow, Boehringer Ingelheim, CrowdStrike, Zscaler, IBM, Palo Alto Networks and Amazon, is expected to drive its prospects in 2025. In the first quarter of 2025, the company secured several contracts, including a mega deal valued at more than $500 million, contributing positively to overall growth.
Can Cognizant sustain its growth momentum with the help of its expanding partner base?
CTSH Expands Clientele With PEGA Deal
Cognizant expanded its collaboration with Pegasystems to enhance its agentic AI services using Pega Blueprint.
Cognizant Technology Solutions Corporation Price and Consensus
Cognizant Technology Solutions Corporation price-consensus-chart | Cognizant Technology Solutions Corporation Quote
The partnership aims to streamline cloud transformations for joint clients by integrating Cognizant’s intellectual property with Pega’s rapid development tools, including the Bluebolt innovation program. Addressing the high costs and inefficiencies of legacy systems, the collaboration uses AI-driven capabilities for legacy code modernization, process optimization, and AI-powered solutions on the Pega Infinity platform.
Together, Cognizant and Pegasystems are enabling enterprises to move beyond traditional modernization approaches toward transformative, AI-infused business growth and improved customer experiences.
Cognizant’s Rich Partner Base to Drive Prospects
Cognizant’s rich partner base has been a major growth driver for its success. In April 2025, the company partnered with OMRON to integrate Information Technology (IT) and Operational Technology in manufacturing, combining OMRON’s automation products with Cognizant’s IT expertise to enable digital transformation and operational excellence.
Cognizant also expanded its partnership with Docusign to enhance customer support and drive digital transformation by providing comprehensive services, including real-time assistance, training, back-office support, and onboarding consultations for Docusign solutions.
Cognizant Benefits From Expanding Portfolio
Cognizant’s expanding portfolio has been noteworthy. It has advanced its AI capabilities, with innovations like the Neuro AI Multi-Agent accelerator, Neuro Cybersecurity and Neuro Edge for real-time AI. These developments allowed the company to expand its AI offerings. In first-quarter 2025, Cognizant deepened its AI capabilities with more than 1,400 Generative AI engagements across multiple clients.
Further expanding its portfolio, Cognizant announced the open-sourcing of its Neuro AI Multi-Agent Accelerator, allowing researchers and developers to prototype and build customizable multi-agent systems quickly. This move aims to advance AI adoption by fostering collaboration and supporting scalable, secure deployment of agent networks across industries.
CTSH Initiates Strong Q2 Guidance
Cognizant’s strong portfolio, along with an expanding partner base, reflects solid top-line growth potential over the long run.
Cognizant expects second-quarter 2025 revenues between $5.14 billion and $5.21 billion, indicating growth of 5.9%-7.4% and an increase of 5%-6.5% on a cc basis.
The Zacks Consensus Estimate for second-quarter 2025 revenues is pegged at $5.19 billion, indicating year-over-year growth of 6.92%.
The consensus mark for earnings is pegged at $1.25 per share, which has increased by a couple of pennies over the past 30 days. The figure implies a year-over-year increase of 6.84%.
What Should Investors Do With CTSH Stock?
Cognizant’s expanding clientele and robust AI-driven solutions are continuously contributing to its growth prospects and driving top-line growth.
Cognizant stock currently carries a Zacks Rank #2 (Buy), which implies that investors should start accumulating the stock right now. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
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Pegasystems Inc. (PEGA) : Free Stock Analysis Report
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CTSH Rises 9% in a Month: Is the Stock a Must-Have for Your Portfolio?

After sharpening his skills under the legendary currency trader George Soros, the billionaire Stanley Druckenmiller started the Duquesne Capital Management hedge fund in 1986. The fund produced 30% returns annually before he converted it into a family office, a private fund that's much easier to manage.
These days, individual investors can't get Druckenmiller to manage their money directly, but there is a way to follow his trades. The Securities and Exchange Commission requires everyone who manages over $100 million in assets to disclose their trading activity every three months.
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Disclosures from the first three months of 2025 are in, and we can see that Druckenmiller has been busy. He added a dozen new positions to the Duquesne Family Office portfolio during the first quarter and more shares to over a dozen existing positions.
Flutter Entertainment (NYSE: FLUT), Docusign (NASDAQ: DOCU), and Taiwan Semiconductor Manufacturing (NYSE: TSM) were Druckenmiller's biggest bets during the first quarter. Here's what everyday investors should know about these stocks before they consider following his lead.
1. Taiwan Semiconductor
One of Druckenmiller's biggest bets in the first quarter of 2025 was the leading manufacturer of cutting-edge semiconductors. Taiwan Semiconductor stock started 2025 dressed in green but finished the quarter significantly lower.
In the first quarter, Druckenmiller boosted Duquesne's Taiwan Semiconductor position by 457% to 491,265 shares. We don't know when he backed up the truck. We do know that shares of the chip foundry business fell to less than 22 times trailing-12-month earnings near the end of March.
Taiwan Semiconductor (TSMC for short) has recovered from low points in early March thanks to first-quarter results that beat Wall Street expectations. First-quarter revenue soared 41.6% year over year. On the bottom line, earnings per share shot 60% higher.
First-quarter sales were slightly depressed from the previous quarter, but capital expenditure (capex) guidance from its biggest customers suggests enough demand for its foundry services to support modest growth from recent levels.
Nvidia is TSMC's biggest customer, and in turn, Microsoft is Nvidia's biggest customer. During the quarter ended in March, Microsoft increased property, plant, and equipment expenditures by 53% year over year to an annualized $67 billion. Citing a customer contracted backlog of $315 billion, Microsoft expects capex to keep growing.
2. Flutter Entertainment
In the first quarter, Druckenmiller boosted a tiny position in this online gambling stock by purchasing over 1 million shares. It was the 11th-largest holding in the Duquesne portfolio at the end of March.
Flutter Entertainment owns the popular FanDuel brand, which grew monthly users by 11% year over year to 4.3 million at the end of March. That works out to a market share of 43% in the U.S. sports betting market.
It is successfully leveraging its position as a leading sportsbook operator to boost its iGaming online wagering businesses. In March, the company launched a FanDuel cross-promotion that has already lifted monthly iGaming users in the U.S. above 1 million.
At the moment, the FanDuel sportsbook operates in only 23 states, and its online gambling operation in the U.S. is just getting started. Its U.S. iGaming business grew first-quarter revenue by 32% year over year to $472 million.
Outside the U.S., iGaming is responsible for a majority of revenue. In the U.S., though, it made up just 28% of first-quarter sales.
3. Docusign
In the first quarter, Druckenmiller's family office started a new position in Docusign. At a value of $87.5 million, it was the 10th largest position in the portfolio at the end of March.
Sales growth has decelerated since the pandemic, but revenue is still moving in the right direction. Subscriptions were responsible for 97% of first-quarter revenue, which grew 7% year over year.
Docusign reported a gross margin that declined slightly, but at 78.9%, this is still a highly profitable subscription-based software business. First-quarter free cash flow rose to $232.1 million, which was an impressive 33% of total revenue.
Everyone I ask has signed documents online that were managed by a Docusign competitor. Despite operating in the commoditized e-signature business, sales keep moving in the right direction because subscribers are more interested in the long-term management of those agreements.
They can't all be zingers
Druckenmiller has a tremendous track record, but he is not infallible. Among these three stocks, Taiwan Semiconductor is his largest holding. At just 3.2% of the portfolio, though, if the semiconductor cycle were to start a downward trend next week, his portfolio would hardly register the sting. If you're going to follow his lead regarding any of these stocks, it's best to make them an even smaller part of your portfolio.
Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?
Before you buy stock in Taiwan Semiconductor Manufacturing, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Taiwan Semiconductor Manufacturing wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $642,582!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $829,879!*
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See the 10 stocks »
*Stock Advisor returns as of May 19, 2025
Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Docusign, Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Flutter Entertainment Plc and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.