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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Dropbox, Inc. (XNAS:DBX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
DBX
Name:
DROPBOX, INC. (XNAS:DBX)
Sector:
130.70M
Industry:
Software�Infrastructure
CEO:
Mr. Andrew Houston
Total Employees:
2,667
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -2251.74% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF DROPBOX, INC.(DBX) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SOFTWARE�INFRASTRUCTURE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
21.17
One Month Price Target:
$21.27
Six Month Price Target :
$21.77
Likely Price in One Year's Time:
Ticker:
$22.37
Likely Trading Range Today Under (Normal Volatility)
$21.09
Price Upper limit ($) :
$21.28
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$20.01
This week:
$18.58
This month :
$15.99
Other Primary facts
Market Cap:
7.92B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
368.80M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
19.96%
-12.37%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$26.54
$24.07
$15.80
$18.27
Medium risk (<10%) entry points
Buy Call
Sell Call
$23.26
Buy Put:
Sell Put:
$22.74
$19.07
$19.60
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
DBX
Sharpe Ratio:
2.11%
Comparison:
DBX, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 29.29% higher than the industry
& is -7.26% lower than the market/S&P 500 average
Average Returns/Yield of
DBX
Daily returns:
0.07%
Weekly returns:
0.33%
Monthly returns:
1.32%
Yearly returns:
14.38%
Comparison of returns:
Average annual returns/yield (last 3 years) is 9.82% above industry average
Classification:
DBX, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.91
Statistical test of Returns:
DBX has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.69%
Weekly Volatility:
6.03%
Monthly Volatility:
12.05%
Yearly Volatility:
41.75%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.33%
Volatility in last five trading days has been -87.75% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.47%
Weekly VaR:
-12.23%
Monthly VaR:
-24.46%
How Much Can the price of
DBX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-21%
Worst case (decline):
-84.72%
This translates to price declining to:
$16.75
This translates to price declining to:
$3.23
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
DBX is a 72.62% riskier investment compared to the market/S&P 500 & is 47.88% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -19.12% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
DBX
Beta in relation to market/S&P 500--0.84
Expected beta in 1 year's time:
0.932
Expected beta in 3 year's time:
1.318
Unlevered (debt free) Beta:
-0.214
Beta in relation to Nasdaq (XNAS):
0.874
Beta in relation to all global stocks::
0.62
Beta Comparison & Analysis
Beta of competitors/peers::
1.508
Beta is -44.00% lower than peers
Average Industry Beta:
1.112
Beta is -24.04% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
8157.58%
Sustainable growth rate is 2107.25% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.069
Alpha is 89.64% above industry average alpha yield
Alpha is 437% higher than market/& is unsustainably high
Analysis of Cost of Capital of
DBX
Equity cost of capital:
0.089
Equity cost of capital is -17.00% below industry mean WACC
Unlevered (without debt) cost of capital:
-2.26%
Before-tax cost of debt:
0.01%
After-tax cost of debt:
0.01%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.01%
WACC is -79.50% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$5.99
Revenue growth rate per share of (3Y):
-16.85
Annual revenue growth rate is -39.34% below industry average
EPS:
$1.15
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$1.87
-
-
Debt per share
$5.86
EBITDA per share
$1.36
Valuation Analysis Today of
DBX
P/E Ratio:
23.79
P/E Ratio of Competitors/Peers:
277.66
P/E ratio is -91.43% lower than main peers & is -63.54% lower than the industry
Stock price/value with industry average P/E ratio: $75.02
DBX is -71.78% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
3.53
Price to sales ratio is -67.81% below the industry mean
P/B (Price to book value ratio):
-16.85
Price to free cash flow: 11.33
Price to free cash flow ratio is -76.53% lower than the industry
Net income growth rate (3Y):
-164.42%
Net income growth rate is -101.94% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
-466.24%
Net debt to equity ratio:
-413.58%
Debt to assets ratio:
75.74%
Net debt to assets ratio:
67.18%
Debt-to-asset ratio is 8.62% above industry average
Ability to repay debt:
Interest coverage ratio:
1677
Interest coverage ratio is -894.71% less than industry average
Looking forward:
Debt growth rate:
150.05%
Annual debt growth is 39% higher than industry average debt growth rate
Debt repayment rate in last quarter: 1.48%
Analysis of Key Statistics
Correlation of price movement with the market:
0.529
Statistical significance of correlation:
DBX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.48
Stock price is 10.28% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.48
Correlation of price movement with Nasdaq (^IXIC):
-0.019
Covariance of price movement with the market:
-0.03
Kurtosis
8.032
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.685
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
DBX
Gross Profit Margin Ratio:
319%
Operating Profit Margin Ratio:
14.55%
Operating profit margin is -222.60% lower than the industry
Net Profit Margin Ratio:
319%
Effective Tax Rate:
-6.11%
Effective tax rate is -119.52% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-79.41%
Return on equity (ROE) is -174.39% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
12.90%
Return on assets (ROA) is -440.64% lower than the industry
Financial Leverage:
4.1x
Current Ratio:
1.45
Current ratio is -37.61% below industry average
Cash Conversion Cycle (days):
-12.3
Cash conversion cycle is -110.92% below industry average
The remaining useful life of property plant & equipment is: 6.1 years
Stock based compensation to net income ratio:
19.65%
In-depth Efficiency Analysis
Revenue generated per employee:
828.2K
Each employee generates 110% more revenue than industry average revenue per employee
EBITDA generated per employee:
188.6K
Each employee generates 189% more EBITDA than industry average revenue per employee
Profit generated per employee:
137.9K
Each employee generates 559% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
49.0K
Each employee generates 148% more free cash flow than industry average revenue per employee
Assets/Capital per employee
460.9K
Each employee generates 148% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 3.90%
Growth rate in R&D investment/expenditure is -250.55% lower than the industry
Competitors/Peer firms of
DBX
PFPT
Amdocs Limited (XNAS:DOX)
MCAFEE CORP. (XNAS:MCFE)
MKS INSTRUMENTS, INC. (XNAS:MKSI)
UNIVERSAL DISPLAY CORPORATION (XNAS:OLED)
IPG PHOTONICS CORPORATION (XNAS:IPGP)
FLEX LTD. (XNAS:FLEX)
SUNRUN INC. (XNAS:RUN)
BUMBLE INC. (XNAS:BMBL)
Current Analyst Ratings
Strong buy�4%
Buy�25%
Hold�17%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
2.21B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
447.80M
1.76B
785.50M
219.50M
640.00M
420.50M
-
1.43B
-
300.00K
156.10M
503.10M
321.40M
367.90M
346.70M
- 21200.00K
367.90M
Statement of Cash Flow
Date:
Period:
39.40M
Differed Income Tax :
-
Stock Based Compensation :
72.30M
Change in Working Capital :
- 61800.00K
Accounts Receivables:
-
Other Working Capital:
- 74100.00K
Other Non-Cash Items:
11.80M
Net Cash Provided by Operating Activities:
141.40M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
- 81600.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
445.50M
1.05B
1.50B
44.60M
-
82.70M
1.62B
736.40M
355.90M
50.00M
-
-
86.80M
1.23B
-
2.85B
24.40M
201.50M
85.50M
691.70M
199.80M
1.12B
2.16B
37.80M
2.20B
-
3.32B
-
- 2854900.00K
- 28100.0K
-
March 31, 2022 at 6:00:00 AM
1.87B
- 463300.00K
2.85B
-
2.36B
1.9B
189.30M
- 6700.00K
101.00M
- 32400.00K
200.00K
- 259900.00K
-
- 36700.00K
- 328800.00K
- 1100.00K
- 87500.00K
445.50M
533.00M
141.40M
- 10700.00K
130.70M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
DBX
2023
2024
2025
2026
2027
$22.48
$106.36
$112.40
$118.77
$125.52