1 Glorious Growth Stock Down 75% to Buy on the Dip in July

Core Viewpoint - Docusign's stock has significantly declined from its peak, but the launch of its new AI-powered platform, Intelligent Agreement Management (IAM), presents a potential investment opportunity as it addresses a $2 trillion problem in contract management [2][4][17]. Group 1: Company Performance - Docusign went public in 2018 at $29 per share and peaked at $310 by mid-2021 due to increased demand during the COVID-19 pandemic [1]. - The company's stock is currently trading 75% below its peak, reflecting a slowdown in business as social conditions normalized in 2022 [2]. - In the fiscal 2026 first quarter, Docusign reported $763.7 million in revenue, an 8% increase year-over-year, exceeding management's forecast [8]. - The company's operating expenses grew by only 1.6% year-over-year, leading to a 166% increase in operating profit to $60.2 million [9]. - Docusign's net income for the same quarter was $72.1 million, a 113% increase compared to the previous year [10]. Group 2: New Product Launch - The IAM platform aims to solve poor contract management processes that cost businesses $2 trillion annually [4]. - IAM includes tools like Navigator, which stores contracts and uses AI to extract important information, making contract management simpler [5]. - The AI-Assisted Review tool helps identify problematic clauses in contracts and can reduce legal expenses for businesses [6]. - Docusign's international IAM sales surged by 50% from the previous quarter, indicating strong demand for the new platform [7]. Group 3: Valuation and Investment Potential - Docusign's price-to-sales (P/S) ratio has dropped to 5.4, significantly lower than its long-term average of 12.4, suggesting the stock may be undervalued [13][14]. - The company is shifting focus towards profitability rather than aggressive revenue growth, which may lead to more sustainable long-term performance [12]. - If Docusign continues to generate consistent GAAP profits, it could eventually be valued using the price-to-earnings (P/E) ratio, enhancing its attractiveness as an investment [16].