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Dropbox IPO - Investment case Presentation

Research

Publication Date: 20 Sep 2018 - By Robert Prather By Robert Prather
Actionable
Differentiated

IPO & Placements Equity Fundamental Equity USA Technology

Dropbox is a cloud-storage company and is headquartered in San Francisco. It is a global collaboration platform and provides an online service that enables individuals and businesses to store and share documents and other digital media. The service has over 500mn registered users across 180+ countries, 11m of which are paying users. In FY17, they grew sales 31% yoy to $1.1bn, with nearly half of revenue being generated from paying users outside the US. 

Strengths & Opportunities

  • Secular tailwinds in cloud storage market
  • Strong brand name and brand awareness
  • Steady growth
  • Improving margins and shrinking losses
  • Positive cash from operations
  • High customer retention rate

Risks & Concerns

  • Decelerating revenue growth
  • User growth slowing
  • Proportion of paying users very low
  • Analysts expect industry growth to decelerate
  • No product differentiation
  • Increasing competition and pricing pressure

 

 

 

 

 

Dropbox IPO

Source: VR Fundamental

Pages: 60

Released: 20 Sep 2018

Unlock for 10 credits

The Author

Robert Prather

Equity Analyst

Technology, Consumer, Telecom & Media, Industrials

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