What happened
Shares of DocuSign (DOCU +0.78%) jumped higher on Thursday, gaining as much as 4.5% earlier in the session, though the stock ended the trading day up 4.4%.
The e-signature stock rode the coattails of the broader market higher as a wide cross section of stocks were up throughout the day. DocuSign shares may also still be riding a tailwind from recent news that its CEO had purchased a large block of company stock.
NASDAQ: DOCU
Key Data Points
So what
Regulatory filings show that CEO Daniel Springer bought four separate blocks of DocuSign stock last week, nearly doubling his existing holdings. The total of recent investments had a purchase price of roughly $5 million and an average cost per share of $74.76. This brought his total holdings to more than $14.6 million at Thursday's closing price.
Image source: Getty Images.
Springer isn't the only one betting big on DocuSign's future success. Regulatory filings from February reveal that Blackrock (BLK +0.00%), The Vanguard Group, and T. Rowe Price each hold a substantial amount of the electronic signature specialist's stock, at 5.9%, 7.3%, and 5.3% of shares outstanding, respectively.
Now what
DocuSign is the undisputed leader in the e-signature space, controlling an estimated 70% of the market, while the company's Agreement Cloud is just getting started. But fears of slowing growth and the recent Nasdaq bear market have conspired to weigh on the stock, which has tumbled more than 65% since last year's high. As late as last Friday, DocuSign shares were trading at their lowest price in nearly two years, a rare occurrence for this growth stock.
That said, there are many reasons to sell a stock but only one reason to buy. The fact that Springer -- who is intimately familiar with DocuSign and its future prospects -- is buying such a sizable position suggests that he's bullish on the company over the long term. This should give investors confidence that the sky isn't falling after all.
