DocuSign CEO Shuffle: Why One Analyst Remains On The Sidelines For Now

Zinger Key Points
  • DocuSign CEO Dan Springer has been replaced.
  • The CEO shuffle isn't the first move DocuSign has made to attempt to stop the bleeding.

After a horrendous year for Docusign Inc DOCU, the company made a major announcement this week that CEO Dan Springer will be stepping down. DocuSign board chair Mary Agnes “Maggie” Wilderotter will be taking over as interim CEO, and Bank of America analyst Brad Sills said Wednesday that the management shakeup should not be a big surprise to investors.

Management Missteps: In addition to her new role at DocuSign, Wilderotter serves as a director at Costco Wholesale Corporation COST, Sana Biotechnology Inc SANA and LYFT Inc LYFT. Sills said DocuSign has made several execution missteps in recent quarters, and a change of direction makes sense as the company attempts to retool and rebalance its sales team and strategy.

Related Link: What's Going On With DocuSign Stock Today?

"As with any transition, we believe there is some risk, with Mr. Springer’s departure possibly weighing on employee morale/sales productivity. However, new leadership could potentially expedite the transition underway," Sills said.

How To Play It: The CEO shuffle isn't the first move DocuSign has made to attempt to stop the bleeding. In the first quarter, the company named Steve Shute as president of Worldwide Field Operations.

For now, Sills remains on the sidelines while DocuSign attempts to prove a path to sustainable profitability. Bank of America has a Neutral rating and a $72 price target.

Benzinga's Take: Earlier this month, DocuSign reported a net loss of $27.4 million in the first quarter, missing consensus analyst estimates and representing a much larger loss than the $8.3 million loss in the same quarter a year ago. DocuSign's revenue growth has also steadily fallen from 57.9% in the first quarter of 2021 to just 25.5% in the most recent quarter.

Price Target
Posted In: Analyst ColorNewsPrice TargetReiterationSmall CapManagementAnalyst RatingsBank of AmericaBrad SillsDan SpringerMary AgnesSteve Shute