Dropbox, Inc. (NASDAQ:DBX) Given Consensus Rating of "Reduce" by Brokerages

Key Points

• Analyst consensus is “Reduce”: Three of eight brokerages rate Dropbox a sell, four recommend holding, and one recommends buying. The average 12-month price target is $30.75, below the reported share price of $34.83.
• Quarterly results slightly beat expectations: Dropbox reported earnings of $0.75 per share versus the $0.74 consensus estimate, while revenue reached $631.5 million compared with expectations of $626.69 million. Revenue increased 0.9% year over year.
• Insiders have been net sellers, while institutions remain heavily invested: Insiders sold 38,667 shares worth about $1.29 million in the last quarter, although insiders still own 35.48% of the company. Institutional investors and hedge funds own 94.84% of Dropbox’s stock.

Shares of Dropbox, Inc. (NASDAQ:DBX - Get Free Report) have been assigned an average recommendation of "Reduce" from the eight brokerages that are covering the company, MarketBeat reports. Three research analysts have rated the stock with a sell rating, four have given a hold rating and one has assigned a buy rating to the company. The average 12 month target price among brokerages that have covered the stock in the last year is $30.75.

A number of research firms recently issued reports on DBX. William Blair raised Dropbox from an "underperform" rating to a "market perform" rating in a research note on Friday, August 7th. Citigroup raised their price target on Dropbox from $28.00 to $33.00 and gave the stock a "neutral" rating in a research report on Friday, August 7th. Wall Street Zen cut Dropbox from a "buy" rating to a "hold" rating in a report on Saturday, August 8th. Bank of America restated an "underperform" rating on shares of Dropbox in a research report on Friday, August 7th. Finally, Zacks Research lowered Dropbox from a "hold" rating to a "strong sell" rating in a research note on Wednesday, August 19th.

Dropbox Stock Performance

NASDAQ:DBX opened at $34.83 on Tuesday. The firm has a 50-day moving average price of $32.30 and a two-hundred day moving average price of $27.84. Dropbox has a twelve month low of $21.69 and a twelve month high of $36.37. The company has a market capitalization of $7.86 billion, a P/E ratio of 19.35, a price-to-earnings-growth ratio of 5.15 and a beta of 0.65.

Dropbox (NASDAQ:DBX - Get Free Report) last announced its earnings results on Thursday, August 6th. The company reported $0.75 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.74 by $0.01. The company had revenue of $631.50 million during the quarter, compared to analysts' expectations of $626.69 million. Dropbox had a net margin of 17.49% and a negative return on equity of 24.26%. The firm's quarterly revenue was up .9% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.71 earnings per share. On average, equities research analysts predict that Dropbox will post 1.93 earnings per share for the current year.

Insider Activity

In related news, insider Eric T. Webster sold 15,830 shares of the company's stock in a transaction that occurred on Tuesday, August 18th. The shares were sold at an average price of $34.09, for a total transaction of $539,644.70. Following the transaction, the insider owned 416,236 shares of the company's stock, valued at approximately $14,189,485.24. This represents a 3.66% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CAO Sarah Schubach sold 1,631 shares of the firm's stock in a transaction that occurred on Monday, August 31st. The stock was sold at an average price of $35.50, for a total transaction of $57,900.50. Following the sale, the chief accounting officer owned 115,150 shares in the company, valued at approximately $4,087,825. This trade represents a 1.40% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 38,667 shares of company stock valued at $1,285,874 over the last quarter. 35.48% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Dropbox

Several hedge funds have recently made changes to their positions in DBX. Empowered Funds LLC increased its stake in Dropbox by 7.3% in the first quarter. Empowered Funds LLC now owns 38,795 shares of the company's stock valued at $1,036,000 after purchasing an additional 2,655 shares during the last quarter. Cetera Investment Advisers boosted its stake in Dropbox by 10.8% in the 2nd quarter. Cetera Investment Advisers now owns 24,623 shares of the company's stock worth $704,000 after buying an additional 2,405 shares during the last quarter. EverSource Wealth Advisors LLC grew its holdings in Dropbox by 88.0% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 1,681 shares of the company's stock valued at $48,000 after buying an additional 787 shares during the period. Cresset Asset Management LLC grew its holdings in Dropbox by 75.8% in the 2nd quarter. Cresset Asset Management LLC now owns 15,230 shares of the company's stock valued at $436,000 after buying an additional 6,569 shares during the period. Finally, Federated Hermes Inc. increased its stake in shares of Dropbox by 360.9% during the 2nd quarter. Federated Hermes Inc. now owns 117,852 shares of the company's stock valued at $3,371,000 after acquiring an additional 92,280 shares during the last quarter. Institutional investors and hedge funds own 94.84% of the company's stock.

About Dropbox

Dropbox, Inc NASDAQ: DBX is a leading provider of cloud-based file storage, collaboration, and productivity tools. Founded in 2007 and headquartered in San Francisco, California, the company offers a suite of services designed to help individuals and organizations securely store, share, and manage digital content. Dropbox has grown from a simple file-syncing application into an integrated collaboration platform used by millions of customers around the globe.

At its core, Dropbox provides cloud storage plans tailored for consumers and businesses.

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