Cloud-based electronic signature solutions provider DocuSign, Inc. (NASDAQ: DOCU) is gearing up to release its fourth-quarter fiscal 2022 results this Thursday, March 10. Ahead of the print, Wall Street analysts are showing signs of cautious optimism, resulting in a Moderate Buy consensus rating based on 2 Buys and 4 Holds on TipRanks. Most recently, Morgan Stanley analyst Stan Zlotsky reiterated a Hold rating on the DOCU stock and trimmed the price target to $121 from $165.
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Does Wall Street sense something we don’t? Did the popularity of DocuSign’s solutions take a hit in Q4? After all, the third quarter results had failed to impress.
Moreover, the strategically curated business of DocuSign thrives on subscriptions, and the website highlights its various subscription plans for different business needs. Most users who visit the website, do so with some particular business requirement. This increases the chances of a visiting user making a purchase. Did businesses turn to alternative options for their electronic signature and document generation needs during the last quarter?
Insights from Estimated Monthly Visits
To answer these questions and gain some insights on DocuSign’s website trends, we took the help of TipRanks’ new tool which analyses the volume of visits to a company’s website.
The tool showed us that there has been a 10.98% quarter-over-quarter decrease in estimated visits globally to DocuSign’s website during the Q4. This may have had an impact on the company’s subscription revenues, which account for about 97% of total revenues generated by DOCU. This is because the less people visit the website, the lower the chances are of converting them to subscriptions.
Also, when we looked deeper, we saw that website visits were down 1.56% from the same quarter last year. This was also discouraging, as this might have somewhat watered down the year-over-year comparison for subscription revenues, which management expects to have grown 33% to 34% by the end of Q4.
The fact that DocuSign’s investors recently lost confidence in it is well known. The stock had witnessed a sharp sell-off on December 3 after a dismal Q3 earnings result, and shares are still languishing. All in all, it will be interesting to see why not only investors, but also customers, recently turned away from the company.
On TipRanks, the average DOCU price prediction points toward an average price target of $191.60, representing a potential 12-month upside of 99.29%, as of intraday 10:38 EST Monday.
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