Guided by the conservative skepticism, DocuSign (DOCU.US) has seen its target price downgraded by major Wall Street banks.

Electronic signature service provider DocuSign (DOCU.US) fell nearly 7% in early trading on Friday, despite the company announcing what some analysts called a "robust" third-quarter performance and guidance. Several Wall Street institutions still lowered their target prices, putting pressure on market sentiment. Wedbush analysts pointed out in a research report that DocuSign had a "comprehensive beat" this quarter, with both revenue and profits exceeding market expectations, driven by strong demand for Identity Access Management (IAM) and electronic signature businesses. However, they also emphasized that the company's conservative outlook would overshadow the bright spots in performance. "Although the company delivered a robust quarter, we believe that the revised guidance remains on the conservative side." Wedbush maintained a "neutral" rating on the stock but lowered the target price from $85 to $75. Piper Sandler also lowered DocuSign's target price from $90 to $75, reflecting a cautious outlook on the company's prospects. For the quarter ending on October 31, DocuSign reported an adjusted earnings per share of $1.01, exceeding analysts' expectations of $0.92; quarterly revenue increased by 8.4% year-over-year to $818 million, also higher than the market estimate of $807 million. Subscription revenue was $801 million, while professional services and other revenue were $17.4 million. Looking ahead to the fourth quarter, the company expects revenue in the range of $825 million to $829 million, slightly below the market expectation of $827.4 million. Subscription revenue is expected to be between $808 million and $812 million; billings revenue is expected to be between $992 million and $1 billion; adjusted gross margin is forecasted to be 80.8% to 81.1%. Despite the short-term conservative guidance, DocuSign raised its full-year outlook. The company expects full-year revenue to be between $3.208 billion and $3.212 billion, higher than the previous range of $3.19 billion to $3.2 billion; subscription revenue estimates have also been raised to $3.14 billion to $3.144 billion, surpassing the previous target of $3.12 billion to $3.13 billion. Overall, DocuSign had a strong third quarter performance, but with differing views between growth momentum and conservative management outlook, Wall Street analysts lowered target prices as the main factor affecting the stock price. Investors will continue to monitor the company's stability in subscription business, billings growth, and profit margins.