DOCU Stock Alert: What to Know About DocuSign’s New CEO

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Cloud software firm DocuSign (NASDAQ:DOCU), which specializes in e-signature solutions, announced on Sept. 22 that its board of directors hired Allan Thygesen as CEO. Thygesen hails from Google under parent company Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), serving several years spearheading various marketing initiatives. DOCU stock struggled throughout this past week amid troubling economic circumstances, symbolizing the challenges awaiting the new chief executive.

Thygesen will take over the helm from Mary Agnes “Maggie” Wilderotter. Per MarketWatch, Wilderotter will stay on as chair of DocuSign’s board. Previously, Thygesen served as president of Google’s Americas and Global Partners unit, leading the company’s advertisement business in North and South America. Prior to this position, Thygesen served as president of Google Marketing Solutions, which oversaw the global mid-market and small advertiser business.

The incoming CEO has also held roles at The Carlyle Group (NASDAQ:CG) and Wink Communications.

“During this time of accelerated digital transformation at companies large and small, there is no better person to lead DocuSign than Allan Thygesen,” said Wilderotter, per a company press release. “He is a customer-focused innovator with deep experience in e-commerce, the digitalization of business, and leading high-growth scale organizations. The Board believes that Allan is the right leader to help DocuSign continue to capture the massive market opportunity that lies ahead.”

DOCU Stock Faces a Tough Road Ahead

DocuSign’s new head exec expressed optimism for the company’s prospects. “DocuSign has a long history of delivering the most trusted, fully-integrated platform for digital agreements, and I am honored to lead the company in its next great chapter,” said Thygesen. Still, DOCU stock stares at difficult circumstances.

Primarily, the gradual fading of the coronavirus pandemic mitigates the cynical hostage audience narrative that previously undergirded DocuSign. During the initial onset of Covid-19, contactless services commanded a significant fundamental premium. DOCU stock rose dramatically in 2020 as the underlying platform enabled people to conduct business without much face-to-face interaction.

Now that Covid restrictions are mostly gone, the need for contactless arrangements diminished substantially. However, the double whammy is that even with greater social mobility, DocuSign’s total addressable market suffers diminishment.

As NPR pointed out, the Federal Reserve’s pivot to a hawkish monetary policy — which translates to higher interest rates — sparked a housing selloff recently. Therefore, DocuSign may see reduced sales volume as big-ticket transactions diminish across the country.

To be fair, Thygesen commands an impressive professional pedigree. Further, the knowledge the exec brings to the table in driving various marketing initiatives should prove helpful to DocuSign. However, the main challenge is to spark momentum in a deflationary environment. On a year-to-date basis, DOCU stock has slipped around 67%.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.

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