DBX - Dropbox Is Cheap Given Its $1 Billion In FCF Growing Margins And New Products On The Horizon
2024-01-24 08:19:53 ET
Summary
- Dropbox trades at reasonable valuations compared to other tech companies, making it an attractive investment.
- The company is transitioning to a fully remote company, controlling for costs, improving margins & expects $1 billion in free cash in FY23.
- Management's cost and product initiatives are encouraging enough for me to upgrade the stock to a Buy.
Investment Thesis
As markets move higher every day, the exuberance of valuations for technology stocks reaches nosebleed levels, reflecting the extreme optimism market participants have in these stocks. Although I am bullish about the sector generally, I am finding it increasingly difficult to justify the valuations of most tech companies today. Fortunately, Dropbox ( DBX ) trades at some reasonable valuations despite the enthusiasm in the broader technology sector....
Dropbox Is Cheap Given Its $1 Billion In FCF, Growing Margins And New Products On The Horizon