Parkev Tatevosian, CFA on $DOCU (Nov 3, 2026)
DocuSign is still a buying opportunity and still undervalued on forward P/E and on a discounted cash flow value of $101 versus an $83 market price, but conviction is lower: the stock has more than doubled in 2026, pushing the forward P/E from under 10 to 15.9, near fair value. The speaker expects long-term EPS growth of 11-12% versus Wall Street's 14.7%, sees AI as less of a threat than feared, notes revenue per employee doubled to 463,000, and sees the small e-signature market deterring larger rivals.
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After a rocky start to the year, DocuSign's stock is experiencing a significant rise. Based on today's market price, the stock has risen by more than 21 % since the beginning of 2026.
After falling to around $40 per share, its value has more than doubled to exceed $82 per share.
The proliferation of proxy AI has not been as "killer" for DocuSign's business as some had feared earlier this year. I have rated DocuSign as a buy opportunity for 2026. So, I am pleased to see the business performing well amid the changing technology landscape.
DocuSign has linked its work to platforms such as Google's Slack and Gemini, among others, to make DocuSign easier to use as a preferred signature option.
But does all this make DocuSign a buying opportunity even today after the stock price has doubled ? This is the question I want us to answer together.
Let's look at these recent developments, compare them to the company's long-term performance, and balance them against the updated valuation, to determine whether it is still a buying opportunity for long-term investors.
You can see the stock price performance I was talking about for DocuSign in 2026. I've been following this company for a long time, and one of the biggest risks was that a bigger competitor would create one of its services and take over its market share.
I always felt that the total market available for electronic signatures was so small that major companies would not bother trying to steal DocuSign's dominant position. Total spending on electronic signatures is less than $100 billion annually.
In the big picture, this is one of the smallest markets available that you will find in any business category. Thus, with this type of relatively small opportunity, the larger players will not bother to create a product to compete with someone who already enjoys a dominant position as a market leader.
However, I expect the electronic signature industry to continue to grow, as signing documents on physical paper does not seem logical in 95% of use cases. There is, of course, that percentage of 5% or 10%.
I won't argue with you about this size, which may require a physical signature for safety and precaution, will I ? But for the other 90%, you can be satisfied with an electronic signature, but the market has not reached that point yet.
Therefore, I believe that electronic signatures will continue to grow until they reach approximately 90% of the market share for all signatures worldwide.
Wall Street analysts who follow DocuSign expect strong long-term earnings per share growth, forecasting 14.7% growth in earnings per share over the medium to long term. But if you ask me, I would expect a percentage lower than 14.7 %.
I am more inclined to expect long-term earnings growth for Docosine stock of between 11 and 12% over the next few years.
One of the factors I watch closely at many technology companies is revenue per employee. I see this metric as a way to assess how well a company learns to improve its performance, and thus increase its productivity at the individual employee level.
It is also evidence for me that the company is using artificial intelligence to enhance the organization's productivity. And I see this remarkable improvement in "DocuCyne". Its revenue per employee has almost doubled from about 250,000 in 2019 to 463,000 during the last twelve months.
Now, with the improvement in the price of "DocuSign" shares, its market value has become even higher.
Earlier this year, the stock was trading at a forward price-to-earnings ratio of less than 10, and I noted at the time that it was an excellent buying opportunity. But the stock is now trading at a forward price-to-earnings ratio of 15.9, double what it was earlier this year, in line with the stock's price doubling since the start of the year.
Incidentally, if we compare the forward price-to-earnings ratio of 15.9 with the company’s long-term earnings per share growth estimates of 14.7%, the price-to-earnings-to-growth (PEG) ratio is approximately one to one.
In addition, I updated my assessment of DocuSign's discounted cash flows and raised my estimates because the company is performing better than I expected at this stage . Therefore, I have now calculated the company's value at $101 per share compared to the current market price of $83.
Therefore, I still believe that the company is undervalued, whether measured by the price-to-earnings ratio or the discounted cash flow model. I have stated that I have rated this stock as a buy opportunity all year round, and the last update to this rating was on June 26, 2026.
As you can see, the stock price has more than doubled during that period. So, I hope you saw this as a buying opportunity. Today, I reiterate that it is still a buying opportunity, but I am lowering my level of conviction and confidence in this assessment.
Since the share price has already doubled and is close to its fair value, my conviction and level of confidence that this is a strong buying opportunity has decreased .