Wall Street Zen Upgrades Dropbox (NASDAQ:DBX) to Buy

Key Points

• Dropbox has received an upgrade to a Buy rating from Wall Street Zen, moving up from a previous "hold" rating.
• UBS Group has downgraded Dropbox's rating from "neutral" to sell, reducing its price objective from $29.00 to $27.00 amid a mixed consensus rating across brokerages.
• In recent insider activity, CFO Timothy Regan sold 5,000 shares, reflecting a 1.05% decrease in his position, amidst reports that institutions have increased their stake in Dropbox significantly.

Dropbox (NASDAQ:DBX - Get Free Report) was upgraded by investment analysts at Wall Street Zen from a "hold" rating to a "buy" rating in a research note issued to investors on Saturday.

A number of other brokerages have also issued reports on DBX. UBS Group lowered shares of Dropbox from a "neutral" rating to a "sell" rating and cut their price objective for the company from $29.00 to $27.00 in a report on Thursday, September 18th. Weiss Ratings reaffirmed a "hold (c+)" rating on shares of Dropbox in a report on Wednesday, October 8th. Three analysts have rated the stock with a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat.com, Dropbox currently has a consensus rating of "Reduce" and an average target price of $29.67.

Dropbox Trading Up 2.5%

Dropbox stock opened at $29.10 on Friday. The firm has a 50 day moving average of $29.49 and a 200 day moving average of $28.48. The firm has a market capitalization of $7.85 billion, a price-to-earnings ratio of 17.74, a P/E/G ratio of 3.74 and a beta of 0.67. Dropbox has a 12-month low of $24.42 and a 12-month high of $33.33.

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

Insider Activity

In other news, CFO Timothy Regan sold 5,000 shares of the stock in a transaction that occurred on Wednesday, October 1st. The stock was sold at an average price of $29.76, for a total transaction of $148,800.00. Following the completion of the transaction, the chief financial officer directly owned 471,621 shares in the company, valued at approximately $14,035,440.96. This represents a 1.05% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, CTO Ali Dasdan sold 12,812 shares of the stock in a transaction that occurred on Monday, September 8th. The shares were sold at an average price of $30.00, for a total value of $384,360.00. Following the transaction, the chief technology officer owned 551,060 shares of the company's stock, valued at $16,531,800. This represents a 2.27% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last ninety days, insiders sold 318,632 shares of company stock worth $9,248,234. 29.95% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the company. Elequin Capital LP boosted its position in shares of Dropbox by 71.0% during the 1st quarter. Elequin Capital LP now owns 1,130 shares of the company's stock valued at $30,000 after acquiring an additional 469 shares during the last quarter. Neo Ivy Capital Management bought a new stake in Dropbox in the second quarter worth $30,000. Geneos Wealth Management Inc. lifted its position in Dropbox by 78.0% in the second quarter. Geneos Wealth Management Inc. now owns 1,273 shares of the company's stock worth $36,000 after buying an additional 558 shares during the last quarter. Brooklyn Investment Group lifted its position in Dropbox by 250.3% in the first quarter. Brooklyn Investment Group now owns 1,387 shares of the company's stock worth $37,000 after buying an additional 991 shares during the last quarter. Finally, Cullen Frost Bankers Inc. bought a new stake in Dropbox in the second quarter worth $41,000. 94.84% of the stock is currently owned by institutional investors.

Dropbox Company Profile

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.

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