It’s déjà vu for DocuSign (NASDAQ:DOCU) investors. The tech stock was down big again last week after the company’s guidance was underwhelming, leading to a steep selloff. The same thing happened when shares of the company crashed in December, as guidance issued then also failed to impress.
Since Dec. 1, DocuSign’s stock is now down a whopping 68%. Although the markets haven’t done well during that time period either, the S&P 500 has declined by a much more modest rate of 7%. Finishing the week at just over $75, shares of DocuSign are now at the prices they were at when the pandemic first began two years ago, giving back all of its gains since then.
For the current fiscal year, DocuSign projects that its revenue will be between $2.47 billion and $2.48 billion. That’s slightly below the $2.6 billion analysts were expecting. It’s not a huge miss, and it’s still above the $2.1 billion that it generated this past fiscal year. After the release of the earnings, many brokerages downgraded and lowered the price targets for DocuSign. However, many still believe it could still be worth north of $90, which would represent an upside of at least 20% of where it finished last week.
Even though employees are returning to their offices this year, DocuSign still believes that they aren’t necessarily returning to paper. For long-term investors, there’s an opportunity to buy DocuSign’s stock at pre-pandemic prices, which could prove to be a steal of a deal years from now.