Spotify Technology SA Stock Forecast:
According to 23 analyst predictions for Spotify Technology SA stock, the average target price for the next 12 months is USD 121.22. The average analyst rating for the company is “Strong Buy.” However, Stock Target Advisor has a “Slightly Bearish” analysis of the company based on 3 positive signals and 6 negative signals. The current stock price for Spotify Technology SA is USD 112.72 and has experienced a 13.53% increase in the past week, a 42.77% increase over the past month, and a 42.57% decrease in the last year.
Spotify Q4 Earnings News:
Spotify (SPOT:NYE) announced its fourth quarter financial results on January 31st, showing a combination of positive and negative results.
The company’s loss was wider than expected, but it exceeded expectations on gross margin. The number of monthly active users was higher than anticipated, totaling 489 million, with both premium and ad-supported subscribers surpassing predictions.
The Spotify stock, which saw a significant decrease in value in 2022, showed fluctuations in early premarket trading but has since increased by 9% as investors analyzed the results.
The revenue was €3.17 billion, which was lower than the expected €3.18 billion, while the loss per share was -€1.40, compared to the predicted -€1.30.
The number of premium subscribers rose by 10 million in the quarter, reaching 205 million, and the number of ad-supported users increased by 22 million to a total of 295 million.
The company expects the first quarter subscribers to reach 500 million, surpassing expectations of 492.2 million.
Analysts Coverage Change (SPOT:NYE):
Raymond James maintains Spotify with an Outperform rating and raises the price target to $130 from $110 on the company’s stock.
KeyBanc Capital Markets raises the price target to $140 from $125 and maintains the Overweight rating on the Spotify stock.
Rosenblatt Securities maintains a Neutral rating on Spotify and raises the price target to $110 from $87.
Pivotal Research Group maintains Spotify with a Hold rating and raises the price target to $130 from $100 on the company’s stock.
Positive Fundamentals:
High market capitalization refers to the total value of a company’s outstanding shares of stock. A high market capitalization indicates that the company is well-established and highly valued by investors. This can lead to increased stability as the company is more likely to have the resources to weather economic downturns or other challenges.
Positive cash flow refers to the amount of cash that a company generates from its operations after accounting for all its expenditures. Positive cash flow is considered a positive sign for investors as it suggests that the company is generating enough revenue to cover its expenses and has the ability to reinvest in growth.
Positive free cash flow refers to the amount of cash a company has available after accounting for capital expenditures. This metric is important as it gives a more accurate picture of a company’s financial health, as it takes into account the money the company has to spend on investments in new projects, technology, or other growth initiatives. Positive free cash flow suggests that a company has the financial strength to reinvest in growth and continue to develop its business.
In the case of Spotify, having high market capitalization, positive cash flow, and positive free cash flow can all be seen as positive signs for potential investors. These factors indicate that the company is well-established, financially stable, and generating enough cash to reinvest in growth.
Negative Fundamentals:
Investing in Spotify stock can be risky due to its high volatility and above median total returns for its sector over the past 5 years.
The stock is also overpriced when compared to earnings, book value, cash flow, and free cash flow when compared to its peers, and is priced above the median for its sector.
The company is highly leveraged, meaning it has a high amount of debt compared to its equity.
