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Dropbox (DBX) Gains But Lags Market: What You Should Know

Zacks Equity Research
·2-min read

Dropbox (DBX) closed at $19.97 in the latest trading session, marking a +1.58% move from the prior day. The stock lagged the S&P 500's daily gain of 2.29%. Meanwhile, the Dow gained 1.99%, and the Nasdaq, a tech-heavy index, added 2.81%.

Coming into today, shares of the online file-sharing company had gained 4.57% in the past month. In that same time, the Computer and Technology sector gained 16.75%, while the S&P 500 gained 19.13%.

Wall Street will be looking for positivity from DBX as it approaches its next earnings report date. On that day, DBX is projected to report earnings of $0.14 per share, which would represent year-over-year growth of 40%. Meanwhile, our latest consensus estimate is calling for revenue of $451.78 million, up 17.16% from the prior-year quarter.

DBX's full-year Zacks Consensus Estimates are calling for earnings of $0.70 per share and revenue of $1.87 billion. These results would represent year-over-year changes of +40% and +12.76%, respectively.

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Investors should also note any recent changes to analyst estimates for DBX. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. DBX is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, DBX is holding a Forward P/E ratio of 28.29. This valuation marks a premium compared to its industry's average Forward P/E of 25.41.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 39, putting it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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Zacks Investment Research