Why DocuSign (DOCU) Shares Are Sliding Today
What Happened:
Shares of e-signature company DocuSign (DOCU) fell 8.3% in the afternoon session after Reuters reported that private equity firms Bain Capital and Hellman & Friedman have suspended their plan to acquire the company due to disagreements on the acquisition price. According to the sources, it is possible that the deal talks resume in the future. DocuSign has been at the center of takeover chatters in recent months. On February 1, 2024, Bloomberg reported that JPMorgan and Bank of America were in talks to finance a $ 13 billion buyout of the company.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy DocuSign? Access our full analysis report here, it's free.
What is the market telling us:
DocuSign's shares are very volatile and over the last year have had 10 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 24 days ago, when the company gained 5.3% on the news that Reuters reported that private equity firms Bain Capital and Hellman & Friedman are in competition to acquire the company. According to sources, "The two private equity firms are among the final bidders in the auction for DocuSign...While the investment firms have not joined forces, it is possible that they may partner down the line to clinch a deal."
DocuSign is down 4% since the beginning of the year, and at $54.73 per share it is trading 17.9% below its 52-week high of $66.65 from February 2023. Investors who bought $1,000 worth of DocuSign's shares 5 years ago would now be looking at an investment worth $1,043.
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