Dropbox (NASDAQ:DBX) Cut to "Sell" at UBS Group

Key Points

• UBS Group has reiterated a "sell" rating for Dropbox (NASDAQ:DBX), reducing its price target from $29.00 to $27.00, indicating a potential downside of 14.77% from the previous close.
• Wall Street Zen has downgraded Dropbox from a "buy" to a "hold" rating, contributing to a consensus rating of "Reduce" among analysts, with an average target price of $29.67.
• Dropbox's stock recently saw a 1.5% decline in value, despite reporting earnings of $0.71 per share for the last quarter, exceeding analysts' expectations and generating a net revenue of $625.70 million.

Dropbox (NASDAQ:DBX - Get Free Report) was downgraded by analysts at UBS Group from a "neutral" rating to a "sell" rating in a research report issued to clients and investors on Thursday, Marketbeat Ratings reports. They currently have a $27.00 price objective on the stock, down from their prior price objective of $29.00. UBS Group's price target would suggest a potential downside of 13.18% from the company's previous close.

Separately, Wall Street Zen downgraded shares of Dropbox from a "buy" rating to a "hold" rating in a report on Friday, September 5th. Two investment analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat.com, the stock has a consensus rating of "Reduce" and an average target price of $29.67.

Dropbox Price Performance

Shares of DBX traded down $0.58 on Thursday, reaching $31.10. The company's stock had a trading volume of 1,261,510 shares, compared to its average volume of 3,691,108. The stock has a market capitalization of $8.39 billion, a P/E ratio of 18.96, a PEG ratio of 4.25 and a beta of 0.70. The stock's 50 day simple moving average is $28.31 and its two-hundred day simple moving average is $27.95. Dropbox has a 12-month low of $24.25 and a 12-month high of $33.33.

Dropbox (NASDAQ:DBX - Get Free Report) last posted its quarterly earnings data on Thursday, August 7th. The company reported $0.71 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.63 by $0.08. The company had revenue of $625.70 million for the quarter, compared to the consensus estimate of $618.60 million. Dropbox had a net margin of 19.17% and a negative return on equity of 61.31%. The firm's revenue was down 1.4% compared to the same quarter last year. During the same quarter last year, the firm posted $0.60 earnings per share. Analysts expect that Dropbox will post 1.64 earnings per share for the current year.

Insider Transactions at Dropbox

In other news, insider William T. Yoon sold 11,430 shares of the company's stock in a transaction dated Monday, September 8th. The shares were sold at an average price of $30.16, for a total value of $344,728.80. Following the transaction, the insider directly owned 223,662 shares in the company, valued at approximately $6,745,645.92. This represents a 4.86% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, CTO Ali Dasdan sold 12,812 shares of the company's stock in a transaction dated Monday, September 8th. The stock was sold at an average price of $30.00, for a total transaction of $384,360.00. Following the completion of the transaction, the chief technology officer owned 551,060 shares in the company, valued at approximately $16,531,800. The trade was a 2.27% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last quarter, insiders sold 314,333 shares of company stock valued at $8,938,399. Company insiders own 29.95% of the company's stock.

Institutional Inflows and Outflows

Hedge funds have recently made changes to their positions in the stock. Wedge Capital Management L L P NC grew its holdings in Dropbox by 1,640.3% during the 1st quarter. Wedge Capital Management L L P NC now owns 2,141,026 shares of the company's stock worth $57,187,000 after acquiring an additional 2,017,997 shares in the last quarter. VIRGINIA RETIREMENT SYSTEMS ET Al bought a new position in Dropbox during the 2nd quarter worth about $56,911,000. Norges Bank bought a new position in Dropbox during the 2nd quarter worth about $51,307,000. Seizert Capital Partners LLC grew its holdings in Dropbox by 524.8% during the 1st quarter. Seizert Capital Partners LLC now owns 1,879,374 shares of the company's stock worth $50,198,000 after acquiring an additional 1,578,566 shares in the last quarter. Finally, LSV Asset Management lifted its position in shares of Dropbox by 18.4% during the first quarter. LSV Asset Management now owns 7,633,516 shares of the company's stock valued at $203,891,000 after buying an additional 1,187,395 shares during the last quarter. 94.84% of the stock is currently owned by institutional investors.

About Dropbox

Dropbox, Inc provides a content collaboration platform worldwide. The company's platform allows individuals, families, teams, and organizations to collaborate and sign up for free through its website or app, as well as upgrade to a paid subscription plan for premium features. It serves customers in professional services, technology, media, education, industrial, consumer and retail, and financial services industries.