Long Position on DBX @ $27.00 on 6/3/2021 (Fundamentals)

Dropbox, Inc. (DBX) provides a collaboration platform worldwide.

Its platform allows individuals, 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.

As of December 31, 2020, the company had approximately 700 million registered users across 180 countries.

The company was formerly known as Evenflow, Inc. and changed its name to Dropbox, Inc. in October 2009.

Dropbox reported 1st Quarter March 2021 earnings of $0.37 per share on revenue of $511.6 million. The consensus earnings estimate was $0.30 per share on revenue of $505.2 million. Revenue grew 12.4% on a year-over-year basis.

The company said during its conference call it expects second quarter revenue of $522.0 million to $525.0 million and now expects 2021 revenue of $2.118 billion to $2.13 billion. The company's previous guidance was 2021 revenue of $2.095 billion to $2.115 billion. The current consensus revenue estimate is $517.65 million for the quarter ending June 30, 2021 and revenue of $2.11 billion for the year ending December 31, 2021.

Elliott Management has taken a sizable stake in software company Dropbox, making it the activist fund's latest target, Cara Lombardo of Wall Street Journal reports, citing people familiar with the matter. Elliott has told Dropbox it is the company's largest shareholder after CEO Drew Houston, which suggests the hedge fund owns a stake of more than 10%, worth well over $800M, sources told the Journal. The two sides have been in talks since earlier this year, reports Lombardo. Shares of Dropbox are up 6% to $28.32 following the report.

Entry Point: $27.00

Stop Loss: $25.65

Trading Range: $17.66 - $29.00

Target Price: $29.70

Updates

6/10/2021 3:52:23 PM

DBX closed at $29.80

Position closed on 6/10/2021 at price of $29.80 with a 10.37% gain in 7 days.

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