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Spotify Technology SA SPOT Stock Quote

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Morningstar‘s Stock Analysis SPOT

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Is it the right time to buy or sell?

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Spotify Posts Impressive Listener Growth; Margin Expansion to Begin in 2023; Shares Undervalued

Ali Mogharabi Senior Equity Analyst

Analyst Note

| Ali Mogharabi |

Spotify reported mixed third-quarter results with a top-line beat but a miss on the bottom line when compared with the FactSet consensus estimates. While the ad-supported segment displayed some weakness due mainly to the macro environment, the premium segment’s subscriber count and monetization continued to post healthy growth, although contribution from foreign exchange was material. The firm’s fourth-quarter outlook was also mixed with revenue and operating guidance ahead of and worse than current expectations, respectively. We adjusted our revenue estimates lower to account for lower ad spending during this year and part of 2023. Our new fair value estimate for Spotify, which also takes into account the stronger dollar, is now $170, down from $187. In our view, shares of no-moat Spotify remain attractive at current levels.

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Key Statistics SPOT

Company Profile SPOT

Business Description

Spotify, headquartered in Stockholm, Sweden, is one of the world’s largest music streaming service providers, with over 150 million total listeners. The firm monetizes its users through both a paid subscription model, referred to as its premium service, and an ad-based model, referred to as its ad-supported service. Revenue from premium and ad-supported services represented 90% and 10% of Spotify’s 2017 total revenue, respectively.

42-44, Avenue de la Gare
Luxembourg, L-1610, LUX
Industry Internet Content & Information
Employees 6,617

FAQs for Spotify Technology SA Stock

No. SPOT does not currently have a forward dividend yield.
Dividend yield allows investors, particularly those interested in dividend-paying stocks, to compare the relationship between a stock’s price and how it rewards stockholders through dividends. The formula for calculating dividend yield is to divide the annual dividend paid per share by the stock price.

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SPOT’s market cap is 14.52 Bil.
Market capitalization is calculated by taking a company’s share price and multiplying it by the total number of shares. It’s often used to measure a company’s size. In the Morningstar Style Box, large-cap names account for the largest 70% of U.S. stocks, mid-cap names account for the largest 70–90%, and small-cap names are the remaining 10% of companies.

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SPOT’s stock style is Mid Growth.
Style is an investment factor that has a meaningful impact on investment risk and returns. Style is calculated by combining value and growth scores, which are first individually calculated.

High-growth stocks tend to represent the technology, healthcare, and communications sectors. They rarely distribute dividends to shareholders, opting for reinvestment in their businesses. More value-oriented stocks tend to represent financial services, utilities, and energy stocks. These are established companies that reliably pay dividends.

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SPOT’s beta can be found in Trading Information at the top of this page.
A stock’s beta measures how closely tied its price movements have been to the performance of the overall market.

Compare SPOT’s historical performance against its industry peers and the overall market.