Spotify Technology (NYSE:SPOT) Rating Lowered to Strong Sell at Zacks Research

Spotify Technology (NYSE:SPOT) was downgraded by equities researchers at Zacks Research from a “hold” rating to a “strong sell” rating in a research report issued to clients and investors on Thursday, Zacks reports.

Several other equities analysts have also commented on the stock. JPMorgan Chase & Co. increased their price target on shares of Spotify Technology from $650.00 to $700.00 and gave the company an “overweight” rating in a research note on Friday. Guggenheim lifted their price objective on shares of Spotify Technology from $575.00 to $650.00 and gave the company a “buy” rating in a research note on Friday. TD Cowen reaffirmed a “hold” rating and issued a $525.00 target price on shares of Spotify Technology in a report on Friday. Piper Sandler reiterated a “neutral” rating and set a $580.00 target price (up from $540.00) on shares of Spotify Technology in a research note on Friday. Finally, Barclays raised their price target on Spotify Technology from $565.00 to $650.00 and gave the stock an “overweight” rating in a report on Friday. One research analyst has rated the stock with a Strong Buy rating, twenty-three have assigned a Buy rating, nine have given a Hold rating and one has issued a Sell rating to the company’s stock. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $620.07.

Spotify Technology Stock Performance

NYSE:SPOT opened at $583.84 on Thursday. The stock has a 50-day simple moving average of $526.60 and a 200-day simple moving average of $497.87. The stock has a market cap of $120.20 billion, a P/E ratio of 38.72, a P/E/G ratio of 1.81 and a beta of 1.61. Spotify Technology has a 1 year low of $405.00 and a 1 year high of $676.67.

Spotify Technology (NYSE:SPOT) last issued its earnings results on Tuesday, August 4th. The company reported $3.03 earnings per share for the quarter, missing the consensus estimate of $3.16 by ($0.13). The business had revenue of $5.45 billion for the quarter, compared to analyst estimates of $5.47 billion. Spotify Technology had a return on equity of 36.15% and a net margin of 15.74%. Spotify Technology’s revenue was up 13.9% on a year-over-year basis. During the same period last year, the business posted ($0.42) EPS. On average, equities research analysts predict that Spotify Technology will post 13.64 EPS for the current year.

Insiders Place Their Bets

In other news, CEO Gustav Söderström sold 20,913 shares of the business’s stock in a transaction dated Monday, September 14th. The shares were sold at an average price of $544.19, for a total transaction of $11,380,645.47. Following the transaction, the chief executive officer directly owned 20,025 shares in the company, valued at $10,897,404.75. The trade was a 51.08% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Alex Norström sold 5,436 shares of the business’s stock in a transaction dated Monday, August 3rd. The stock was sold at an average price of $502.10, for a total transaction of $2,729,415.60. Following the transaction, the chief executive officer owned 66,773 shares in the company, valued at approximately $33,526,723.30. This trade represents a 7.53% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last 90 days, insiders have sold 68,092 shares of company stock valued at $35,762,410. 0.40% of the stock is owned by insiders.

Institutional Investors Weigh In On Spotify Technology

A number of institutional investors have recently added to or reduced their stakes in SPOT. Pin Oak Investment Advisors Inc. purchased a new position in shares of Spotify Technology during the 2nd quarter worth approximately $27,000. Portus Wealth Advisors LLC purchased a new stake in shares of Spotify Technology in the first quarter valued at approximately $32,000. Whipplewood Advisors LLC boosted its stake in shares of Spotify Technology by 423.1% in the first quarter. Whipplewood Advisors LLC now owns 68 shares of the company’s stock valued at $33,000 after buying an additional 55 shares in the last quarter. Palladiem LLC purchased a new stake in shares of Spotify Technology in the first quarter valued at approximately $34,000. Finally, Tsfg LLC grew its holdings in Spotify Technology by 39.7% during the second quarter. Tsfg LLC now owns 81 shares of the company’s stock worth $37,000 after acquiring an additional 23 shares during the period. Hedge funds and other institutional investors own 84.09% of the company’s stock.

Key Stories Impacting Spotify Technology

Here are the key news stories impacting Spotify Technology this week:

• Positive Sentiment: Spotify reported 306 million premium subscribers in the third quarter, up 9% year over year and 1 million above its guidance. Monthly active users rose 11% to 788 million, with growth across all regions. Spotify Stock Jumps as Subscriber Growth Beats Expectations
• Positive Sentiment: Revenue increased roughly 16% year over year to about €4.97 billion, while gross margin expanded 140 basis points to 33% and operating income exceeded company guidance. Spotify expects fourth-quarter operating profit above Wall Street expectations and projects revenue of approximately €6.0 billion. Spotify forecasts fourth-quarter profit above estimates on AI bets
• Positive Sentiment: Management highlighted AI-powered personalization, including its “taste model,” as a way to increase listening, reduce churn and support pricing power. It also expects moderating expenses and continued margin expansion, with long-term targets of more than 20% operating margin and 35%–40% gross margin by 2030. Spotify Soars After Earnings as the Company Touts AI Benefits and Moderating Costs
• Positive Sentiment: Several analysts raised their targets following the results. Morgan Stanley and JPMorgan lifted targets to $700 with overweight ratings, while Wells Fargo, Barclays, Oppenheimer and Guggenheim also raised targets to $650–$660. Spotify Analysts Raise Their Forecasts Following Q3 Earnings
• Neutral Sentiment: Spotify’s headline results were mixed: quarterly EPS of roughly $2.78–$2.85 missed consensus near $3.10–$3.18, while revenue was slightly below estimates. Piper Sandler maintained a neutral rating with a $580 target, and Cantor Fitzgerald maintained neutral at $550.
• Negative Sentiment: TD Cowen reaffirmed a hold rating with a $525 price target, and some newly raised targets remain below the current market valuation, signaling concerns that much of the subscriber and AI optimism may already be reflected in SPOT shares.

Spotify Technology Company Profile

Spotify Technology SA is an audio streaming company that operates the Spotify platform, offering users access to music, podcasts and audiobooks through internet-connected devices. Its catalog includes licensed recordings from music labels and artists, as well as podcasts and other audio content from creators and publishers.

Spotify provides both an ad-supported service and subscription-based Premium plans. Premium subscribers generally receive ad-free listening and additional features, while the advertising-supported service allows users to access content without a paid subscription.