Dropbox, Inc.

Despite a series of macroeconomic challenges, Dropbox had a good last quarter and managed an all-around beat. The company continued investing in growth projects and should, both organically and through acquisitions, generate future revenue. They also continue to return a sizable percentage of their free cash flow to shareholders through share repurchases. Although they are experiencing moderate growth in their Sign business, it is important to set Dropbox Sign apart from conventional eSign solutions. They are also using value-added services like their API, an increase in developer engagement in Q3, and Dropbox Forms. Among key developments, the company acquired FormSwift to create, finish, update, and preserve crucial business forms and agreements. We maintain our ‘Hold’ rating on the company with a revised target price.