Software Industry Faces AI Disruption as DocuSign's ROE Drops to 39%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 21 2026
0mins
Source: NASDAQ.COM
- Software Stock Decline: The software sector has seen a significant downturn in recent months, with UiPath (PATH) down 84%, Paycom Software (PAYC) down 73%, The Trade Desk (TTD) down 70%, and DocuSign (DOCU) down 65%, reflecting a waning investor confidence in software stocks.
- Impact of AI Tools: The emergence of advanced AI tools has raised investor concerns about their potential to disrupt traditional software companies, as evidenced by DocuSign's return on equity (ROE) plummeting from 169% to 39%, indicating a sharp decline in profitability and market position.
- Signs of Slowing Growth: Atlassian has experienced double-digit EPS growth over the past three years, but projections indicate only a 7.59% growth by 2026, suggesting a weakening growth momentum in the software industry that could affect investor sentiment.
- Shopify's Strategic Response: Unlike many software firms, Shopify has adopted an all-hands-on-deck approach to AI adoption by launching a 24/7 AI-powered chatbot and partnering with OpenAI, which helps it maintain a competitive edge and demonstrates adaptability in the AI era.
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Analyst Views on DOCU
Wall Street analysts forecast DOCU stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for DOCU is 80.23 USD with a low forecast of 70.00 USD and a high forecast of 105.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
16 Analyst Rating
3 Buy
13 Hold
0 Sell
Hold
Current: 56.215
Low
70.00
Averages
80.23
High
105.00
Current: 56.215
Low
70.00
Averages
80.23
High
105.00
About DOCU
DocuSign, Inc. provides intelligent agreement management (IAM) platform an eSignature solution, and contract lifecycle management (CLM) solution - allow organizations to increase productivity, accelerate contract review cycles, and transform agreement data into insights and actions. The Company’s IAM platform automates agreement workflows, uncovers actionable insights, and leverages artificial intelligence (AI) capabilities, enabling organizations to create, commit, and manage agreements virtually. Its products include eSignature, CLM, IAM Apps, and Add-on Products. Its Add-on Products include Payments to collect payments along with signed agreements; Identity and standards-based signature for enhanced signer-identification and signatures with digital certification; Notary for remote online notarization; Monitor for advanced analytics; Gen for Salesforce for automated agreement generation within Salesforce, among others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Salesforce CEO Marc Benioff Warns of AI Threats as Stock Drops 14%
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