DBX Sees New Coverage Amid Rebound Attempt

The stock recently dipped after workforce reduction headlines

Assistant Editor
Jan 15, 2021 at 9:23 AM
facebook twitter linkedin

The shares of DropBox Inc (NASDAQ:DBX) are up a modest 0.2% at $22.72 before the bell, after KeyBanc initiated coverage with a "sector weight" rating. After consolidating below the 40-day moving average for most of November, the stock broke out at the end of the month to culminate in a Dec. 23 annual high of $25.16. Taking a breather since then, DBX's recent bounce off the $21 region was cut short after company cut around 11% of its global workforce. Longer term, the equity remains up roughly 24% year-over-year. 

Coming into today, a majority of analysts were bullish on Dropbox stock. Of the six in coverage, five carry a "strong buy" rating. Plus, the 12-month consensus price target of $28.33 is a 24.9% premium to last night's close. 

The options pits are of similar sentiment, as per the security's 50-day call/put volume ratio of 5.52 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 77% of readings from the past year, indicating long calls are being picked up at a faster-than-usual clip. 

Meanwhile, shorts are jumping ship, with short interest down 25.5% in the last reporting period. The 17.04 million shares sold short still account for 7.5% of the stock's available float, though, and would take nearly three days to cover at DBX's average pace of trading. 



If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

Schaeffer's Investment Research Master Portfolio Trial


Special Offers from Schaeffer's Trading Partners