2 Popular Tech Stocks That Recently Plunged More Than 45%

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Although the tech stocks led the markets higher last week, inflation could end tech stocks’ rally next year. The tech-heavy Nasdaq composite dipped after a three-day winning streak and ended the regular trading session lower on Thursday. Even mega-cap tech shares caused U.S. stocks to tumble last week due to investor concerns over the COVID-19 Omicron variant.

Furthermore, the Fed is expected to consider speeding up the pace of its tapering to $30 billion per month at its December meeting. This might give the Fed flexibility to raise interest rates soon, which in turn could increase the interest expense borne by tech companies, reducing their future earnings.

Given this backdrop, we think investors should take care regarding betting on popular tech stocks DocuSign, Inc. (DOCU) and Asana, Inc. (ASAN), which have plunged more than 45% in price over the past month.

DocuSign, Inc. (DOCU)

San Francisco-based DOCU provides cloud-based software in the United States that delivers an e-signature solution to enable businesses to prepare, sign, and manage agreements digitally. The company’s products include DocuSign eSignature, DocuSign CLM, DocuSign Insight, and other products that include DocuSign Payments and DocuSign Analyzer.

This month, The Schall Law Firm, a shareholder rights litigation firm, started investigating allegations on behalf of investors of DOCU that the company violated securities laws. The investigation is based on whether DOCU issued false and misleading statements and failed to disclose information pertinent to investors after DOCU announced disappointing year-end financial projections on Dec. 2, 2021. This news may negatively impact DOCU’s price performance in the near-term.

DOCU’s total operating expenses for its fiscal third quarter, ended Oct. 31, 2021, increased 29.8% year-over-year to $432.85 million. The company’s loss from operations came in at $3.36 million, and its net loss amounted to $5.68 million during the period. DOCU’s shares have declined 45.7% in price over the past month. The stock closed Friday at $144.48.

Asana, Inc. (ASAN)

ASAN, in San Francisco, is a work management platform that enables individuals, team leaders, and executives to organize work—from daily tasks to cross-functional strategic initiatives.  The company enables its users to communicate, monitor status, and oversee work across projects to gain real-time insights. ASAN provides various features in its platform, including timeline, app integration, automation, and other features.

During its fiscal third quarter, ended Oct. 31, 2021, ASAN’s total operating expenses grew 39.9% from their year-ago value to $158.84 million. Its loss from operations rose 9.9% from the prior-year quarter to $68.09 million. And the company’s net loss came in at $69.28 million. Also, its loss per share amounted to $0.37 during the period.

ASAN’s EPS is expected to decline 22.7% in the current quarter and 28.6% next quarter. The stock has fallen 48.3% in price over the past month. The stock closed Friday at $67.91.

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