DocuSign (DOCU) Stock Forecast & Price Target

Docusign is showing a stronger fundamental profile as F2Q27 revenue rose 9.4% year over year to $876 million, non-GAAP EPS beat consensus at $1.16, and operating margin expanded to 31.6%, with operating cash flow of $334.5 million and free cash flow of $295.8 million reinforcing profitability. Its outlook is supported by IAM momentum, with IAM ARR reaching about $529 million and 15.1% of total ARR, while management raised FY27 revenue, margin, and ARR growth guidance and expects IAM to become 18% to 19% of total ARR exiting F4Q27. The company’s dominant e-signature position, nearly 95% of Fortune 500 customers, 103% net retention, and AI engine Iris trained on over 300 million private consented agreements suggest a sticky platform with expanding cross-sell and durable long-term growth potential.

Docusign is viewed negatively because its revenue is still heavily dependent on e-signature, and any slowing adoption or inability to attract new customers and expand existing accounts would weaken growth. The company also operates in a highly competitive, evolving market while facing cybersecurity risks and the possibility that it overestimated its total addressable market, which could constrain long-term expansion. Fundamentally, the turnaround appears lengthy and uncertain, with sales execution issues, high turnover, a 9% workforce reduction, and a credibility gap after multiple guidance misses and billings disappointments undermining confidence in management’s ability to stabilize results.