Back to top

Image: Bigstock

Is Spotify Technology (SPOT) Stock Outpacing Its Business Services Peers This Year?

Read MoreHide Full Article

The Business Services group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Spotify (SPOT - Free Report) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Business Services sector should help us answer this question.

Spotify is one of 315 individual stocks in the Business Services sector. Collectively, these companies sit at #2 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.

The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Spotify is currently sporting a Zacks Rank of #1 (Strong Buy).

Within the past quarter, the Zacks Consensus Estimate for SPOT's full-year earnings has moved 33.9% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.

Our latest available data shows that SPOT has returned about 61.3% since the start of the calendar year. Meanwhile, stocks in the Business Services group have gained about 7.4% on average. This means that Spotify is performing better than its sector in terms of year-to-date returns.

Another Business Services stock, which has outperformed the sector so far this year, is Inter & Co. Inc. (INTR - Free Report) . The stock has returned 10.1% year-to-date.

Over the past three months, Inter & Co. Inc.'s consensus EPS estimate for the current year has increased 6.6%. The stock currently has a Zacks Rank #2 (Buy).

To break things down more, Spotify belongs to the Technology Services industry, a group that includes 173 individual companies and currently sits at #54 in the Zacks Industry Rank. On average, this group has gained an average of 16.4% so far this year, meaning that SPOT is performing better in terms of year-to-date returns. Inter & Co. Inc. is also part of the same industry.

Investors interested in the Business Services sector may want to keep a close eye on Spotify and Inter & Co. Inc. as they attempt to continue their solid performance.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Spotify Technology (SPOT) - free report >>

Inter & Co. Inc. (INTR) - free report >>

Published in