DocuSign Falls on RBC Downgrade to Sector Perform on Challenging Short-Term Setup

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An analyst from RBC downgraded shares of DocuSign (NASDAQ:DOCU) to Sector Perform from Outperform with a $65 per share price target (down from $80).

The analyst based his downgrade on four key elements:

The analyst remains positive on DOCU in the long-term, especially bearing in mind the company’s total addressable market (TAM), but he sees shares “range-bound until evidence of a successful turnaround and reacceleration.”

On the potential business sales, he added that a $20 billion check “would be tough to write for both private equity and strategic buyers, making a sale somewhat less likely now.”

At current levels, shares are “fairly valued,” the analyst concluded.

DOCU stock is down 3.8% in premarket Monday.