why Dropbox Inc. [DBX] is a Good Choice for Investors After New Price Target of $29.43

Dropbox Inc. [NASDAQ: DBX] slipped around -0.53 points on Wednesday, while shares priced at $22.42 at the close of the session, down -2.31%. The company report on February 24, 2021 that Dropbox, Inc. Announces Upsize and Pricing of $1.306 Billion Convertible Senior Notes Offering.

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Dropbox, Inc. (“Dropbox”) (NASDAQ: DBX) announced the pricing of $653,000,000 aggregate principal amount of convertible senior notes due 2026 (the “2026 Notes”) and $653,000,000 aggregate principal amount of convertible senior notes due 2028 (the “2028 Notes” and, together with the 2026 Notes, the “Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Act”). The aggregate principal amount of the offering was increased from the previously announced offering size of $1.135 billion. Dropbox also granted the initial purchasers of the Notes a 13-day option to purchase up to an additional $65,300,000 aggregate principal amount of 2026 Notes and up to an additional $65,300,000 aggregate principal amount of 2028 Notes. The sale of the Notes to the initial purchasers is expected to settle on February 26, 2021, subject to customary closing conditions, and is expected to result in approximately $1,286 million in net proceeds to Dropbox (or approximately $1,414 million if the initial purchasers exercise their option to purchase additional notes in full) after deducting the initial purchasers’ discount and estimated offering expenses payable by Dropbox.

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The Notes will be senior, unsecured obligations of Dropbox. The 2026 Notes and the 2028 Notes are each referred to herein as a series of notes. The Notes will not bear interest and the principal of each series of Notes will not accrete. The 2026 Notes will mature on March 1, 2026 and the 2028 Notes will mature on March 1, 2028, in each case unless earlier converted, redeemed or repurchased.

Compared to the average trading volume of 7.95M shares, DBX reached a trading volume of 13944853 in the most recent trading day, which is why market watchdogs consider the stock to be active.

What do top market gurus say about Dropbox Inc. [DBX]?

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for DBX shares is $29.43 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on DBX stock is a recommendation set at 2.10. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

KeyBanc Capital Markets have made an estimate for Dropbox Inc. shares, keeping their opinion on the stock as Sector Weight, with their previous recommendation back on January 15, 2021. While these analysts kept the previous recommendation, BofA Securities dropped their target price from $32 to $25. The new note on the price target was released on July 31, 2020, representing the official price target for Dropbox Inc. stock. Previously, the target price had yet another raise from $22 to $28, while Jefferies kept a Buy rating on DBX stock.

The Average True Range (ATR) for Dropbox Inc. is set at 0.97, with the Price to Sales ratio for DBX stock in the period of the last 12 months amounting to 4.88. The Price to Book ratio for the last quarter was 27.68, with the Price to Cash per share for the same quarter was set at 2.69. Price to Free Cash Flow for DBX in the course of the last twelve months was 19.03 with Quick ratio for the last quarter at 1.10.

How has DBX stock performed recently?

Dropbox Inc. [DBX] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -2.18. With this latest performance, DBX shares dropped by -2.05% in over the last four-week period, additionally plugging by 5.90% over the last 6 months – not to mention a rise of 16.08% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for DBX stock in for the last two-week period is set at 43.82, with the RSI for the last a single of trading hit 39.59, and the three-weeks RSI is set at 46.66 for Dropbox Inc. [DBX]. The present Moving Average for the last 50 days of trading for this stock 23.16, while it was recorded at 22.74 for the last single week of trading, and 21.37 for the last 200 days.

Dropbox Inc. [DBX]: Deeper insight into the fundamentals

Operating Margin for any stock indicates how profitable investing would be, and Dropbox Inc. [DBX] shares currently have an operating margin of +6.33 and a Gross Margin at +78.34. Dropbox Inc.’s Net Margin is presently recorded at -13.39.

Return on Total Capital for DBX is now 7.42, given the latest momentum, and Return on Invested Capital for the company is -17.53. Return on Equity for this stock declined to -44.88, with Return on Assets sitting at -10.08. When it comes to the capital structure of this company, Dropbox Inc. [DBX] has a Total Debt to Total Equity ratio set at 335.38. Additionally, DBX Total Debt to Total Capital is recorded at 77.03, with Total Debt to Total Assets ending up at 46.90. Long-Term Debt to Equity for the company is recorded at 278.97, with the Long-Term Debt to Total Capital now at 64.07.

Reflecting on the efficiency of the workforce at the company, Dropbox Inc. [DBX] managed to generate an average of -$92,862 per employee. Receivables Turnover for the company is 42.44 with a Total Asset Turnover recorded at a value of 0.75.Dropbox Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.10 and a Current Ratio set at 1.10.

Earnings analysis for Dropbox Inc. [DBX]

With the latest financial reports released by the company, Dropbox Inc. posted 0.17/share EPS, while the average EPS was predicted by analysts to be reported at 0.14/share. When compared, the two values demonstrate that the company surpassed the estimates by a Surprise Factor of 21.40%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for DBX. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Dropbox Inc. go to 16.80%.

Insider trade positions for Dropbox Inc. [DBX]

There are presently around $5,810 million, or 79.30% of DBX stock, in the hands of institutional investors. The top three institutional holders of DBX stocks are: VANGUARD GROUP INC with ownership of 30,141,324, which is approximately 4.863% of the company’s market cap and around 0.80% of the total institutional ownership; RENAISSANCE TECHNOLOGIES LLC, holding 17,061,743 shares of the stock with an approximate value of $391.57 million in DBX stocks shares; and BLACKROCK INC., currently with $364.12 million in DBX stock with ownership of nearly -2.231% of the company’s market capitalization.

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Positions in Dropbox Inc. stocks held by institutional investors increased at the end of February and at the time of the February reporting period, where 245 institutional holders increased their position in Dropbox Inc. [NASDAQ:DBX] by around 42,350,107 shares. Additionally, 184 investors decreased positions by around 47,938,916 shares, while 62 investors held positions by with 162,850,547 shares. The mentioned changes placed institutional holdings at 253,139,570 shares, according to the latest SEC report filing. DBX stock had 103 new institutional investments in for a total of 5,973,329 shares, while 67 institutional investors sold positions of 23,947,078 shares during the same period.

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