DocuSign, Inc. (NASDAQ:DOCU) is a beaten-down stock. Together with other innovative tech stocks that benefited from the pandemic boosts, DOCU has been declining since touching a high of $313 in August 2021.
At the current price of $95, DOCU is down more than 70%. It should be noted that the stock is rising after touching a low of $72, which equates to around 77% decline from its August high.
At $72, the stock is trading at the same level it initiated a bullish rally at the start of the pandemic. The question investors need to ask is will DOCU slide to further pandemic lows or the stock could price in a post-pandemic environment and go higher?
DocuSign reported a revenue of $580.8 million in the fourth quarter of 2021, an increase of 35% from the prior year. However, the company issued a revenue guidance of between $579 million and $583 million in the first quarter of 2022.
The guidance became an investor concern and this accelerated the stock’s decline to $72. However, as previously noted, DOCU is suffering from a decline in pandemic boosts. With the stock now priced to the post pandemic era, the stock is attractively priced, with the technical indicators pointing to a higher price.
DOCU trades at a pre-pandemic low
Source – TradingView
From a technical analysis, DOCU is emerging from an extremely oversold region after the RSI touched a low of around 21. The RSI reading is currently at around 30, still indicating oversold conditions.
The stock is also jumping from a support of $72, a pre-pandemic low, and investors could consider jumping at the low price. DOCU could consolidate at the current level before the overall sentiment in innovative tech stocks improves.
Summary
DocuSign is attractively priced and could emerge from the pre-pandemic low price soon. The stock is a buy at the current level or after a short retracement to the $72 support. The stock could face hesitance at $135, but the established level is at $194.
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