7 Best Data Storage Stocks To Buy Now

5. Dropbox (NASDAQ:DBX)  

Upside Potential: 19.56%  

Average Analyst Price Estimate: $26.83

Dropbox (NASDAQ:DBX) is a leading file-hosting, cloud storage, and collaboration platform that helps organizations share documents, and files securely over the internet. The company has positioned itself as a key player in the digital workspace industry and has expanded its offerings to various productivity tools. As of December 31, 2023, Dropbox (NASDAQ:DBX) has 18.12 million paid subscribers. Dropbox (NASDAQ:DBX) is positioned as an attractive investment opportunity within the tech sector, the stock is trading at 10.02 times this year’s earnings estimate, a 56% discount to its sector. Analysts expect earnings to grow by 11.42% this year.

The launch of AI-driven products, such as Dropbox Dash, represents a significant growth avenue for Dropbox (NASDAQ:DBX). By integrating AI to enhance user experience and productivity, the company is well-positioned to capture additional market share in the enterprise segment. The company is also making strategic moves to accelerate growth. Management has initiated marketing campaigns and launched a refreshed web design to boost the visibility of products. This approach is aimed at driving upsell and cross-sell opportunities through bundled offerings which will be easier for customers to discover and utilize.

The company is on the verge of reaching its $1 billion free cash flow target for 2024, showcasing its resilience and strong ability to forecast future performance. With over $759 million in free cash flow against an $8.1 billion equity and no net debt, Dropbox (NASDAQ:DBX) presents an attractive 9.2% earnings yield. This consistent recurring revenue and robust cash flow make Dropbox a compelling stock to buy now. The stock is trading at $22.44 as of August 12. Industry analysts have a consensus on the stock’s Buy rating, setting an average share price target at $26.83, which represents a 19.56% upside potential from its current level.