Dropbox Inc. provides a collaboration platform worldwide. Its platform allows individuals, teams, and organizations to create, access, and share content online. The company was founded in 2007 and is based in San Francisco, California.
DBX Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Dropbox Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Dropbox Inc ranked in the 45th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. In terms of the factors that were most noteworthy in this DCF analysis for DBX, they are:
89% of the company's capital comes from equity, which is greater than 71.32% of stocks in our cash flow based forecasting set.
Dropbox Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -6.43. This coverage rate is greater than that of only 10.74% of stocks we're observing for the purpose of forecasting via discounted cash flows.
The weighted average cost of capital for the company is 10. This value is greater than 83.1% stocks in the Technology sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Dropbox Inc? See CDW, INTC, KEYS, FORM, and G.
The coronavirus pandemic accelerated the transition to the cloud as enterprises across the world adopted remote working trends. Gartner estimates that global end-user spending on public cloud services will grow 18.4% to $304.9 billion this year. The research firm expects the proportion of enterprise IT spending on cloud computing to continue to increase and account for 14.2% of the overall global IT spending in 2024, compared to 9.1% in 2020. Using TipRanks Stock Comparison tool, we will find out how Dropbox and Box have fared recently amid the rising demand for cloud services to select the stock offering a more compelling investment opportunity.
In separate notes, KeyBanc Capital Markets initiated coverage of collaboration technology leader Dropbox Inc (NASDAQ: DBX) and cloud content leader Box Inc (NYSE: BOX).The Tech Analyst: Steve Enders initiated coverage of Dropbox with a Sector Weight rating and started coverage of Box with an Overweight rating and $22 price target. The Tech Thesis: Although Dropbox enjoys brand recognition and has a global base of more than 600 million users, the company's Collaboration Workspace platform is still in the early stages and "not yet a catalyst to growth," Enders said in an initiation note.Dropbox's growth has considerably slowed, with stiffening competition that increasingly uses bundling, the analyst said.The company had guided to 12% year-on-year growth for the fourth quarter of 2020 vers...
During his recent interview with Tobias, Andrew Walker, Portfolio Manager at Rangeley Capital discussed Dropbox Inc (NASDAQ:DBX) And That #2 Idea. Here’s an excerpt from the interview: Q3 2020 hedge fund letters, conferences and more Dropbox Inc (DBX) And That #2 Idea Tobias: How well do you know Dropbox? Andrew: Very well. Tobias: Do you want […] The post Rangeley Capital: Dropbox Inc (DBX) Long Thesis appeared first on ValueWalk .
Shares of Dropbox (DBX) are down 5% this morning after the company announced a reduction of its global workforce by approximately 11%, or a total of 315 employees."Last spring I made a commitment to all of you to preserve job security through 2020, and it was important to me that...