Can Dropbox Stock Keep Climbing After Earnings?

The stock still carries a 4.1% year-to-date deficit

Digital Content Manager
Aug 3, 2022 at 12:22 PM
facebook twitter linkedin

Dropbox Inc (NASDAQ:DBX) will enter the earnings confessional after the close tomorrow, Aug. 4. Analysts are expecting the cloud software company to post profits of  37 cents per share and show a rise in revenue for its second quarter. At last check, DBX was up 3% at $23.50. 

The equity has a shaky history of post-earnings moves, going back two years, with just two of these eight instances ending in positive next-day returns. Regardless of direction, the security averaged a next-day swing of 4.5% during this time period, which is much smaller than the 8.7% move the options pits are pricing in this time around. 

Dropbox stock's options pits have been quite bearish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), DBX sports a 10-day put/call volume ratio of 1.31, which stands higher than 92% of readings from the past year. This implies that puts are being picked up at a much quicker-than-usual clip of late. 

Short-term options traders have also been incredibly put-heavy recently. This is per DBX's Schaeffer's put/call volume ratio (SOIR) of 2.23, which sits higher all readings from the past year. 

Analysts have remained optimistic, however. Of the five in coverage, all but one call DBX a "strong buy." Plus, the 12-month consensus price target of $27.42 is a 16.8% premium to current levels. 

Today's positive price action could send the stock to its highest settlement since April, should these gains hold. However, pressure at the 200-day moving average appears to be cutting this rally short, keeping the security at a 4.1% year-to-date deficit. 

dbx aug 3 


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners