Market Overview

What This Analyst Expects From Dropbox's Q1

What This Analyst Expects From Dropbox's Q1

Dropbox Inc. (NASDAQ: DBX) is scheduled to report its first-quarter results after Thursday's market close and should report a strong beat-and-raise quarter, according to DA Davidson.

The Analyst

DA Davidson's Rishi Jaluria maintains a Buy rating on Dropbox' with an unchanged 12- to 18-month price target of $36 and a five-year price target of $43.

The Thesis

Dropbox is modeled to report a non-GAAP EPS of 2 cents per share on revenue of $308.7 million, Jaluria said in a research note. The consensus estimate calls for 5 cents per share on revenue of $308.7 million.

The relatively new public company -- shares IPO'd on March 23 -- is modeled to report the following metrics the analyst says is conservative and likely beatable:

  • Net paying user adds of 450,000;
  • Average revenue per user of $109.99;
  • Calculated billings of $323.7 million;
  • Non-GAAP gross margin to rise 780 basis points from a year ago to 71.3 percent; and
  • Free cash flow (including capital lease payments) of $48.9 million.

The management team is expected to discuss the following topics during the conference call: conversion of individual paying users to business users, traction with Dropbox Paper and the overall competitive landscape.

Price Action

Shares of Dropbox were trading higher by 2.4 percent at $30.11 early Tuesday afternoon.

Related Links:

Dropbox Quiet Period Expires And Analysts Speak Up

Box Inc Is A Buy On Sustained Growth, Favorable Competitive Trends, Says DA Davidson

Latest Ratings for DBX

Feb 2019Bank of AmericaUpgradesNeutralBuy
Dec 2018William BlairInitiates Coverage OnOutperform
Oct 2018NomuraUpgradesReduceNeutral

View More Analyst Ratings for DBX
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