What to Watch For in Dropbox’s Q3

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Dropbox Inc. (NASDAQ: DBX) is scheduled to release its most recent quarterly report after the markets close on Thursday. Consensus estimates from Thomson Reuters are calling for $0.06 in earnings per share (EPS) and $352.57 million in revenue.

In its second quarter, the company beat expectations on both the top and bottom lines, but this was not enough for investors as there were some other factors at play in the report.

Despite the good numbers, the company announced that its chief operating officer, Dennis Woodside, was leaving the company. Woodside officially stepped down in early September after four years with the company. However, he is staying on as an advisor until the end of 2018.

Also in this time, the company reported paying users totaled 11.9 million, as compared to 9.9 million for the second quarter last year. Average revenue per paying user was $116.66, as compared to $111.19 last year.

Overall, Dropbox has underperformed the market since it came public, with its shares down about 12% in this time. However, in the past month, the stock is up 10%.

A few analysts weighed in on Dropbox ahead of the report:

  • Nomura has a Neutral rating and a $25 price target.
  • Monness Crespi & Hardt has a Neutral rating.
  • JMP Securities has an Outperform rating and a $37 target.
  • Canaccord Genuity has a Buy rating and a $38 price target.
  • RBC has an Outperform rating with a $33 price target.
  • Jefferies has a Buy rating with a $37 price target.

Shares of Dropbox were last seen at $25.06, with a consensus analyst price target of $35.42. The stock has a post-IPO trading range of $21.36 to $43.50.