Can DocuSign Stock Reach New Highs After Earnings?

Options traders aren't so sure

Deputy Editor
Sep 2, 2021 at 1:28 PM
facebook X logo linkedin

The shares of DocuSign, Inc. (NASDAQ:DOCU) are down 1.4% at $293.29 at last check, just a few hours ahead of the e-signature vendor's second-quarter earnings call. DocuSign stock pulled back slightly on the charts after nabbing an August 10, all-time high of $314.76, and recently found a floor at the $290 level. Now that DOCU is up 31.7% year-to-date, with support from its 60-day moving average since an early June bull gap, it's worth looking at the equity's history of post-earnings movements and why a positive report could boost it to previously uncharted territory. 

DOCU Chart September 2

Looking back at its past eight quarterly reports, five of DOCU's post-earnings sessions were positive, including a 19.8% pop after the company's last report in June. The security averaged a next-day return of 10.7%, regardless of direction. And though the options pits are pricing a slightly smaller move of 8.5% this time around, an upswing of such magnitude would put DocuSign stock at a new all-time high of $318.22.

Options traders, however, are letting their pessimism show. So far, 22,000 puts and 15,000 calls have exchanged hands -- volume that is double what's typically seen at this point. The weekly 9/3 250-strike put is the most popular, followed by the October 240 put, with positions being opened at both. 

This penchant for puts is par for the course of late, as revealed by DOCU's 10-day put/call volume ratio of 1.45 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 100% of readings in its annual range. Echoing this, the equity's Schaeffer's put/call open interest ratio (SOIR) of 1.26 stands higher than 98% of annual readings, meaning short-term options traders have rarely been more put-biased. 

The good news for options traders is DocuSign stock's options are reasonably priced. DOCU's Schaeffer's Volatility Index (SVI) of 56% is in the 21st percentile of its annual range, implying that options players are pricing in relatively low volatility expectations.



Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI