DocuSign Stock Holds A Lot of Promise
The business world runs on agreements and contracts. As technologies continue to advance, it has become imperative for companies to change their old ways of working.
This has led to a move toward more automation in business processes. And one of the most promising trends related to that is digital transaction management, which has emerged as a new category of cloud services.
Many organizations are adopting e-signature solutions, authentication, workflow automation, and other related applications. By going the digital way, companies avoid the most common problems like lost documents, missing data, and a lack of clarity in workflows.
Every business has a system of agreements and contracts, but most of those systems have not been modernized yet. This is where Docusign Inc (NASDAQ:DOCU) comes in.
DocuSign is a leading player in e-signature solutions. By facilitating electronic contracts and unlocking the signing bottleneck, the company enables businesses to reduce their costs and accelerate the speed of their transactions and operating processes.
The e-signature company is building the global standard for digital transaction management. DocuSign enables preparation, execution, and management of transactions in an all-digital environment.
The company believes that this is a significant and under-penetrated sector, with a total addressable market of about $25.0 billion. This is a big opportunity that DOCU stock owners might be able to gain from immensely.
DocuSign stock made its public debut on April 27 and has had a phenomenal run since then, going up by more than 45%.
Chart courtesy of StockCharts.com
The company’s technology is trusted by customers across verticals. 10 of the top 15 global financial companies, seven of the top 10 global technology companies, and 18 of the top 20 global pharma companies are using DocuSign technology.
DocuSign works with applications and devices that are used extensively by Microsoft Corporation (NASDAQ:MSFT), salesforce.com, inc. (NYSE:CRM), Alphabet Inc (NASDAQ:GOOG), and many more.
DocuSign has a recurring subscription model with strong revenue visibility.
In its fiscal-year 2019 first quarter, the company’s total revenue went up by 37% year-over-year to touch $155.8 million. Subscription revenue was $148.2 million, an increase of 39% year-over-year. (Source: “DocuSign Announces First Quarter Fiscal 2019 Results,” DocuSign Inc, June 7, 2018.)
DocuSign is expected to see higher revenue growth ahead as the market for digital transaction management services expands in different industries. This bodes well for the DOCU stock price.
Furthermore, last month, the company signed a definitive agreement to acquire SpringCM, a leading cloud-based document generation and contract lifecycle management software company. The acquisition was a move toward modernizing the companies’ system of agreement.
DocuSign Inc provides one of the most reliable and globally trusted services for electronic signatures and approvals, with over 85 million users worldwide.
Given the company’s expanding customer base and continuous growth in a high-potential market, DOCU stock looks like it’s set to reach higher levels.
Investors who want to gain from the business world’s move toward using more digital technologies might want to consider DocuSign stock.
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Author: Mukta Samtani, MBA, PhD