DocuSign Inc (DOCU)

[eastunder]

DocuSign price target cut to $45 amid report takeover talks stalled - analyst

https://www.msn.com/en-us/money/companies/docusign-price-target-cut-to-45-amid-report-takeover-talks-stalled-analyst/ar-BB1hOLaw

DocuSign's (NASDAQ:DOCU) price target was reduced at Wells Fargo following a report that its takeover talks with private equity firms have stalled. DocuSign slumped 7.2%.

The price target for the electronic signature firm was cut to $45 from $55 at Wells Fargo, analyst Michael Turrin, who has an underweight rating on DocuSign (DOCU), wrote in a note on Monday.

Talks between private equity firms Bain Capital and Hellman & Friedman and DocuSign (DOCU) have stalled as the parties have been unable to agree to a price after weeks of discussions, according to a Reuters report on Monday, which cited people familiar with the matter.

"We see challenges acquiring DOCU given current scale ($11B mcap) alongside our view the co is facing a tough fundamental backdrop (inc comp headwinds, pricing pressure), leaving mgmt w/ limited options for organic improvement (+ more limited negotiating power)," Turrin wrote. "We believe these issues are likely contributors to Reuter's suggestions interested parties are now cooling & note elevated risk for DOCU standalone given FQ4 just closed."

The latest update comes after Bloomberg last week reported that some banks were in talks to provide financing for a $13 billion purchase of the electronic signature firm.

DocuSign (DOCU) shares first surged 12.5% on Dec. 15 when the Wall Street Journal reported the company could go private via a leveraged buyout. The stock had risen 3.5% from the day before the WSJ news was released until Monday.