DocuSign is a great company but look at this chart, after a 81% decline from its peak, guess what PE multiple it is presently trading at after that sort of pullback?
Still 35x. This shows how overextended those US tech stocks have been - at its peak its PE was about 178x! At its peak, Shareholders paid a valuation that could only be recouped after 178 years ! Even however great a company can be, that is sheer ridiculous. It demonstrates a true bubble , and if a reasonable PE is about 16x, its share price could still fall a further >50% .
Again, this example demonstrates we do not gauge value simply by looking at how far down its share price has gone relative to its peak. It is necessary to determine how ludicrously overextended its price was at its peak.
OCU — TradingView
