DocuSign (DOCU) Outlook ahead of 2022 Q1 earnings

Written by Dennis Mwenga

DocuSign is a NASDAQ listed company with a market capitalization of $16.84b, popularly known for its e-signature platform which provides a way to sign documents electronically on different devices, thus enabling individuals and businesses to digitize agreement processes.

On June 2nd DOCU shares dropped from the $88 level to a low of $82.74 while on June 3rd it bounced from $82.74 back to $87.55-$88.00 before consequently managing to trade sideways. DOCU was trading in a range for 7 consecutive days trading between support at $81 and overhead resistance at $88. In today’s US open, the asset gapped up breaking the latter and the round $90 level.

The breakout of the range and 1-month resistance at $90.00 bring the upper Keltner band into focus at $93.60. A failure to sustain this move should see the price breach or find immediate support at $86.75 and $86.40.

The DocuSign inc 2022 (Q1) quarterly earnings announcement is due on June 9th after the market close. According to Wall Street analysts are pencilling in a forecast of $581.1 million revenue growth (+23.9% year over year), which has been attributed to growth in subscription revenues and a strengthening customer base, with the consensus EPS forecast for the quarter at $-0.08. The reported EPS for the same quarter last year was $-0.03. The stock is also expected to have a high earnings quality ranking (EQR) for the 66th consecutive week. EQR is simply a way of finding out up to what extent current earnings predict future earnings. High EQR is usually expected to persist and Low EQR is not.

About the author

Dennis Mwenga

Dennis Mwenga has worked as an independent trader and educator since 2016. His love for the global financial markets grew as a result of his Bachelor of Laws degree and specialization in commercial law and international trade, which drove him to pursue the Chartered Market Technician (I) program in order to build skills for better investment decisions. As a devoted educator, he was encouraged to contribute to an educational series called 222 Days of Foreign Exchange Trading and later co-author a book on the subject, which drove him to seek a career as a mechanical and automated trading systems trainer. He has also organized and hosted financial markets trading educational podcasts and webinar series, in which he interviewed renowned traders, trading mentors, and fund managers with decades of expertise trading a variety of assets in the financial markets.