Each week, Industry Focus: Financials host Jason Moser and Fool.com contributor Matt Frankel, CFP, discuss one stock that's near the top of their watchlist. This week, Moser has his eyes on DocuSign (NASDAQ: DOCU) ahead of earnings, and Frankel is watching Bank of America (NYSE: BAC) after shares dropped on trade war weakness.
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This video was recorded on June 3, 2019.
Jason Moser: Matt, let's wrap it up here. But before we do, we want to give our listeners one to watch. What is a stock on your radar for this week? You gave us a teaser earlier. I have to believe it's a bank, right?
Matt Frankel: Yeah. Like I mentioned earlier, banks have really underperformed the market recently. They've been getting crushed with the trade war and interest rates going down, so on and so forth. I'm looking at Bank of America. It's performed even worse than most, down about 12% in the past month. It's now trading for just over its book value, which is the first time that's happened in a while. It dipped below it briefly in late 2018. But other than that, it really hasn't dropped to this valuation level in a long time. Bank of America has been doing phenomenally lately. They've gone from being one of the worst-hit banks in the financial crisis to being one of the best-run banks in the country. They keep getting better, they keep getting more efficient, profitability keeps improving. And right now, it's trading at a bargain. Like I said, it's trading for the value of its assets. I think it's a good one to look at.
Moser: Well, there you go. I'm going to go with a company I mentioned before, DocuSign. Earnings are out on Thursday for DocuSign. We will be at FoolFest, actually, on Thursday, all day. I'll be keeping at least one eye peeled on that earnings release. I think everybody remembers that DocuSign offers the e-signature solutions. It serves all sorts of businesses, from sole proprietorships to large enterprises and everywhere in between. And I think not only is it really a good product -- if you've used it before, you understand how seamless it can be -- but I think they're doing a good job of taking this business beyond digital signatures and becoming a little bit more of a full-service provider and helping businesses manage the workflow that comes with all of these documents and agreements and whatnot. You spoke about profitability for Bank of America. I think that's one of the bigger challenges with DocuSign right now. It is not yet profitable. But it has a good reliable subscription business, and it does seem to be getting a lot of good reviews from big customers. Hopefully this is going to be another quarter of growth.