Research analysts at Guggenheim have revised their price target for Spotify Technology (NYSE: SPOT) from $800.00 to $750.00 in a report released on November 4, 2023. Despite this adjustment, Guggenheim maintains a “buy” rating on the stock, indicating an expected upside of approximately 32.13% based on the stock’s previous closing price.
This change comes amid a wave of revisions from various research firms regarding Spotify’s stock performance. On the same day, Erste Group Bank downgraded its rating on Spotify from “buy” to “hold.” In contrast, Benchmark raised its price target from $800.00 to $860.00, also assigning a “buy” rating. Other firms, including Argus and JPMorgan Chase & Co., have set optimistic targets of $845.00 and $805.00, respectively.
As the market evaluates these adjustments, the consensus among analysts remains cautiously optimistic. According to MarketBeat.com, Spotify currently has two analysts rating it as a Strong Buy, twenty-three as Buy, and nine as Hold, which translates to an overall consensus rating of “Moderate Buy” with an average target price of $758.57.
Recent Earnings Performance
Spotify’s recent quarterly earnings report, released on November 4, 2023, showed a significant financial performance. The company reported earnings per share (EPS) of $3.83, exceeding analysts’ expectations of $1.87 by a remarkable $1.96. This performance is underscored by a return on equity of 21.68% and a net margin of 8.46%.
The firm generated $5.01 billion in revenue for the quarter, notably surpassing forecasts of $4.23 billion. Year-over-year, Spotify’s revenue increased by 7.1%, showing resilience in a competitive market. Analysts predict a full-year EPS of $10.30 for Spotify.
Institutional Investment Trends
Institutional investor activity reflects growing interest in Spotify shares. Several hedge funds have recently adjusted their positions. For instance, Joel Isaacson & Co. LLC increased its stake by 1.0% during the second quarter, now holding 1,551 shares valued at approximately $1.19 million. Similarly, Ignite Planners LLC and Stonekeep Investments LLC raised their positions by 2.4% and 2.1% respectively.
Overall, institutional investors own approximately 84.09% of Spotify’s stock, indicating strong confidence in the company’s growth prospects.
Spotify Technology, founded in Sweden in 2006 by Daniel Ek and Martin Lorentzon, has established itself as a leader in the digital audio streaming industry. The company offers a diverse range of audio content, including music and podcasts, through both a free ad-supported service and a paid subscription model. As Spotify continues to evolve, the market will closely monitor how these analyst ratings and earnings impacts the company’s trajectory.
