In the world of growth stocks, NASDAQ:DOCU shines as a value proposition.

Our stock screener has spotted DOCUSIGN INC (NASDAQ:DOCU) as a growth stock which is not overvalued. NASDAQ:DOCU is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Deciphering NASDAQ:DOCU's Growth Rating

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:DOCU was assigned a score of 8 for growth:

• DOCU shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.01%, which is quite impressive.
• The Earnings Per Share has been growing by 87.39% on average over the past years. This is a very strong growth
• DOCU shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.16%.
• DOCU shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 37.15% yearly.
• The Earnings Per Share is expected to grow by 14.23% on average over the next years. This is quite good.
• DOCU is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.83% yearly.

What does the Valuation looks like for NASDAQ:DOCU

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:DOCU has earned a 6 for valuation:

• Based on the Price/Earnings ratio, DOCU is valued cheaply inside the industry as 86.64% of the companies are valued more expensively.
• The average S&P500 Price/Earnings ratio is at 25.92. DOCU is valued slightly cheaper when compared to this.
• DOCU's Price/Forward Earnings ratio is rather cheap when compared to the industry. DOCU is cheaper than 83.39% of the companies in the same industry.
• Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DOCU indicates a somewhat cheap valuation: DOCU is cheaper than 68.95% of the companies listed in the same industry.
• Based on the Price/Free Cash Flow ratio, DOCU is valued cheaper than 89.89% of the companies in the same industry.
• DOCU's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• DOCU's earnings are expected to grow with 14.41% in the coming years. This may justify a more expensive valuation.

ChartMill's Evaluation of Health

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:DOCU has achieved a 5 out of 10:

• An Altman-Z score of 2.99 indicates that DOCU is not in any danger for bankruptcy at the moment.
• DOCU has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

Profitability Analysis for NASDAQ:DOCU

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:DOCU scores a 5 out of 10:

• DOCU's Return On Assets of 1.55% is fine compared to the rest of the industry. DOCU outperforms 74.01% of its industry peers.
• DOCU's Return On Equity of 5.35% is fine compared to the rest of the industry. DOCU outperforms 79.06% of its industry peers.
• The Return On Invested Capital of DOCU (3.57%) is better than 76.90% of its industry peers.
• DOCU has a better Profit Margin (1.90%) than 73.65% of its industry peers.
• DOCU has a better Operating Margin (1.92%) than 71.12% of its industry peers.
• With an excellent Gross Margin value of 79.25%, DOCU belongs to the best of the industry, outperforming 80.87% of the companies in the same industry.

More Affordable Growth stocks can be found in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of DOCU

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.