Dropbox (DBX) versus Its Rivals Financial Contrast

Dropbox (NASDAQ:DBX) is one of 953 public companies in the “Software” industry, but how does it weigh in compared to its competitors? We will compare Dropbox to similar businesses based on the strength of its dividends, earnings, valuation, analyst recommendations, profitability, institutional ownership and risk.

Insider and Institutional Ownership

94.8% of Dropbox shares are owned by institutional investors. Comparatively, 41.8% of shares of all “Software” companies are owned by institutional investors. 35.5% of Dropbox shares are owned by insiders. Comparatively, 19.9% of shares of all “Software” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for Dropbox and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dropbox	3	4	2	0	1.89
Dropbox Competitors	5734	21488	44819	1493	2.57

Dropbox currently has a consensus target price of $31.60, indicating a potential downside of 11.63%. As a group, “Software” companies have a potential upside of 27.96%. Given Dropbox’s competitors stronger consensus rating and higher possible upside, analysts plainly believe Dropbox has less favorable growth aspects than its competitors.

Profitability

This table compares Dropbox and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dropbox	17.49%	-24.26%	15.88%
Dropbox Competitors	-612.41%	21.13%	-8.86%

Valuation & Earnings

This table compares Dropbox and its competitors revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Dropbox	$2.52 billion	$508.40 million	19.87
Dropbox Competitors	$1.85 billion	$386.01 million	106.80

Dropbox has higher revenue and earnings than its competitors. Dropbox is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Risk and Volatility

Dropbox has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, Dropbox’s competitors have a beta of 1.34, indicating that their average stock price is 34% more volatile than the S&P 500.

Summary

Dropbox competitors beat Dropbox on 7 of the 13 factors compared.

Dropbox Company Profile

Dropbox, Inc. provides a content collaboration platform worldwide. The company's platform allows individuals, families, teams, and organizations to collaborate and sign up for free through its website or app, as well as upgrade to a paid subscription plan for premium features. It serves customers in professional services, technology, media, education, industrial, consumer and retail, and financial services industries. The company was formerly known as Evenflow, Inc. and changed its name to Dropbox, Inc. in October 2009. Dropbox, Inc. was incorporated in 2007 and is headquartered in San Francisco, California.