Dropbox (DBX) ended the recent trading session at $28.95, demonstrating a +1.94% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 0.4%. Meanwhile, the Dow experienced a drop of 0.04%, and the technology-dominated Nasdaq saw an increase of 0.66%.
The online file-sharing company's shares have seen a decrease of 11.72% over the last month, not keeping up with the Computer and Technology sector's gain of 2.27% and the S&P 500's gain of 1.02%.
Investors will be eagerly watching for the performance of Dropbox in its upcoming earnings disclosure. On that day, Dropbox is projected to report earnings of $0.64 per share, which would represent year-over-year growth of 6.67%. Simultaneously, our latest consensus estimate expects the revenue to be $623.49 million, showing a 2.4% drop compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $2.69 per share and a revenue of $2.5 billion, demonstrating changes of +8.03% and -2.09%, respectively, from the preceding year.
Investors might also notice recent changes to analyst estimates for Dropbox. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.37% increase. Dropbox presently features a Zacks Rank of #3 (Hold).
In terms of valuation, Dropbox is currently trading at a Forward P/E ratio of 10.56. Its industry sports an average Forward P/E of 24.17, so one might conclude that Dropbox is trading at a discount comparatively.
One should further note that DBX currently holds a PEG ratio of 2.49. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Internet - Services stocks are, on average, holding a PEG ratio of 1.66 based on yesterday's closing prices.
The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 78, putting it in the top 32% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Dropbox, Inc. (DBX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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