Using the midpoint of these guidance ranges puts Dropbox's valuation multiples at: Meanwhile, for the current fiscal year Dropbox has roughly held its guidance of $2.470-$2.485 billion for the year (6-7% y/y growth), and free cash flow of $820-$840 million representing a 33-34% margin:ĭropbox guidance (Dropbox Q1 earnings materials) After we net off the $1.25 billion of cash and $1.37 billion of convertible debt on Dropbox's most recent balance sheet, its resulting enterprise value is $7.68 billion. At current share prices just north of $21, Dropbox trades at a market cap of $7.56 billion. Like the rest of Dropbox's product portfolio, Dropbox Sign has a range of plans and pricing for users of various budgets and levels of sophistication, giving it immediate cross-sell applicability to all segments of Dropbox's customer base.Īnd in spite of these longer-term strengths, Dropbox is still quite undervalued. E-signature opportunity- The addition of an enterprise tool like DocSend (acquired in 2021 and recently rebranded as Dropbox Sign) will further flex Dropbox's muscles in the enterprise space, helping it catch up to its rival Box (the latter of which has long touted superior security capabilities).There are still plenty of opportunities for Dropbox to take market share from Box here. Enterprise market opportunity- Dropbox's traditional strength has always been in smaller/consumer users, though it has started ramping up its enterprise efforts lately (products like Capture add to the company's enterprise resume).Accordingly, Dropbox has differentiated itself from Box by appealing to these professional solo acts and small businesses, which is reflected by Dropbox's greater upsells to premium paid plans. Tools like Dropbox have become necessary infrastructure, and one with very low barriers to entry and ease of setup.
0 Comments
Leave a Reply. |