Spotify's Q1 Outlook: Analyst Anticipates Surge in Subscriber Base and Revenue Per User
Portfolio Pulse from Anusuya Lahiri
Keybanc analyst Justin Patterson maintained Spotify Technology SA (NYSE:SPOT) with an Overweight rating and raised the price target from $300 to $350, anticipating a surge in subscriber base and revenue per user. Patterson expects Spotify's 2024 revenue to be €15.4 billion and 2025 revenue to be €18.0 billion, with a slight increase in ARPU growth. He introduced a 2026 revenue forecast of €20.6 billion with an operating profit of €2.2 billion. The price target increase reflects higher revenue and profitability forecasts, with comparisons made to Netflix Inc's (NASDAQ:NFLX) EV/S multiple expansion. Spotify's stock has gained 130% in the last 12 months, and investors can also gain exposure through Global X Social Media ETF (NASDAQ:SOCL) and ProShares On-Demand ETF (NYSE:OND).
April 12, 2024 | 5:32 pm
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NEUTRAL IMPACT
Netflix Inc's EV/S multiple expansion over five years due to price increases and margin improvement was referenced as a comparison for Spotify's potential growth.
While the article references Netflix's past financial performance as a benchmark for Spotify's potential, it does not directly imply a short-term impact on NFLX's stock price.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
Spotify's stock performance, up 130% in the last 12 months, is accessible to investors through the ProShares On-Demand ETF.
Spotify's inclusion in the OND ETF and its strong performance suggest that positive news and growth forecasts for Spotify could also positively impact OND's performance in the short term.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
Investors can gain exposure to Spotify's stock, which has gained 130% in the last 12 months, through the Global X Social Media ETF.
Given Spotify's significant stock price gain and its inclusion in the SOCL ETF, positive performance and analyst outlook for Spotify could indirectly benefit SOCL's performance in the short term.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
Spotify's price target was raised from $300 to $350 by Keybanc analyst Justin Patterson, anticipating a surge in subscriber base and revenue. The company's stock has gained 130% in the last 12 months.
The increase in Spotify's price target by a reputable analyst due to anticipated growth in subscribers and revenue, along with a significant 12-month stock price gain, suggests a positive short-term impact on SPOT's stock price.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100