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  "documentTitle": "Dropbox, Inc. (DBX)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Spruce Point Capital Management",
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  "presentationDate": "2020-02-06 00:00:00",
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  "notes": "The table highlights that while Dropbox appears cheap on a revenue multiple basis, its adjusted free cash flow multiple is significantly higher than the peer average.",
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      "text": "Dropbox appears very rich on free cash flow basis.",
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      "text": "Adj FCF: 105.0x",
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      "text": "On face value, some may view Dropbox as a \"cheap\" SaaS tech play based on a multiple of revenues. However, investors fail to appreciate Dropbox's revenues are of poor quality, largely tied to retail and small business customers that have stable churn (which we believe will rise), and ARPU growth (which we believe will slow) that will generate lofty 15% sales growth. We believe these targets are at severe risk of not materializing. As investors come to grips with Dropbox's maturity, investors will start to focus on its free cash flow. However, we believe increased customer acquisition costs and capital spending will pressure free cash flow. Dropbox appears very rich on free cash flow basis.",
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      "text": "1) Adjusted for lease repayments and cash used to settle employee stock programs. Source: Company filings, Wall St and Spruce Point estimates. Dropbox's FCF valuation on our projected 2020E",
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      "text": "Dropbox Valuation Higher Than It Looks",
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