Since then fundamentals have not changed, merely some slight upgrades to FY21 guidance and the position is up by roughly 35%. I built a position in Dropbox in late 2020 to early 2021.
Dropbox was growing before the pandemic and will continue to grow after the pandemic. Potentially a result of profit taking combined with investors worrying about growth prospects post pandemic as less people are now working from home. After delivering decent results, Dropbox sold off as much as 10% today. The main goal of focus for investors is management's target of reaching $1 billion in free cashflow by FY24.īased on a conservative DCF, I believe Dropbox's ( NASDAQ: DBX) intrinsic value is around $37.99 per share, representing a 35.69% increase from current prices. Management have outlined a clear strategy for how they intend to grow free cashflow and based on their financial history, have a high probability of delivering on their set goals within the next 4 years. Dropbox Investment Thesisĭropbox is a strong cashflow producing business that has a proven record of growing cashflows since IPOing in 2018.
Editor's Note: This article was amended on to reflect updated commentary around the recent share price move.
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