Dropbox Stock Looking For First Post-Earnings Pop in a Year

The equity is up 9% in 2021 and hit an annual high last week

Assistant Editor
Feb 16, 2021 at 1:54 PM
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The shares of Dropbox Inc (NASDAQ:DBX) are down 0.9%, last seen trading at $24.29, ahead of the file sharing and storage concern's fourth-quarter earnings, which is due out after the close on Thursday, Feb. 18. Below, we will take a look at how Dropbox stock has been faring on the charts ahead of the release, as well as its earnings history ahead of the event.

Dropbox stock boasts a respectable 9% lead in 2021, a mid-January pullback contained by its ascending 50-day moving average. Further, the equity is just a few sessions removed from its highest peak since July 2019, reaching $25.70 on Feb. 8. So, it's no surprise then that there's optimism among the brokerage bunch, with five of seven rating DBX a "strong buy." Short interest appears to have dried up as well -- down 14.9% in the most recent reporting period -- and still accounts for 7.4% of the equity's total available float.

DBX Chart February 16

Looking back at the past two years, the stock has a dismal history following quarterly reports. Of the eight previous reports, just three were positive, though last February saw a 20% pop higher. Still, the equity has notched at least three downward swings of at least 8.4% post-earnings. The security averages a 8% swing, regardless of direction, the day after its last eight quarterly reports, and this time around the options pits are pricing in a much larger 14.8% shift. 

There's been a penchant for bullish bets in the options pits. The equity sports a 50-day call/put volume ratio of 5.71 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 82% of all other readings in its annual range. This shows long calls are being picked up at a faster-than-usual pace in the past 10 weeks.

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