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Dropbox earnings rally


Lillian McKenna

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Hi Lillian, I don't think this is the right time to buy Dropbox (NASDAQ:DBS) shares given that the stock gapped higher following the company's stellar Q4 earnings report. The best course of action in such cases, is to wait for the stock to pullback from its current highs and then buy it at a much lower price.

Most stocks usually pull back after a major rally or a gap up allowing smart traders and investors to take a position in the company at a favourable price. Buying the company's stock at a much lower price gives you a better risk to reward ratio if the stock rallies higher. Therefore, I would wait for a pullback before buying any Dropbox shares.

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