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Spotify (SPOT) Surpasses Market Returns: Some Facts Worth Knowing

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The latest trading session saw Spotify (SPOT - Free Report) ending at $310, denoting a +0.32% adjustment from its last day's close. The stock outpaced the S&P 500's daily gain of 0.27%. Elsewhere, the Dow saw a downswing of 0.31%, while the tech-heavy Nasdaq appreciated by 0.88%.

Heading into today, shares of the music-streaming service operator had gained 6.66% over the past month, outpacing the Business Services sector's loss of 0.58% and the S&P 500's gain of 2.85% in that time.

Market participants will be closely following the financial results of Spotify in its upcoming release. The company is predicted to post an EPS of $1.12, indicating a 166.27% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.08 billion, up 17.91% from the year-ago period.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $4.93 per share and a revenue of $16.73 billion, indicating changes of +267.12% and +16.73%, respectively, from the former year.

Investors should also pay attention to any latest changes in analyst estimates for Spotify. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. At present, Spotify boasts a Zacks Rank of #1 (Strong Buy).

In terms of valuation, Spotify is currently trading at a Forward P/E ratio of 62.68. This denotes a premium relative to the industry's average Forward P/E of 22.67.

The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 58, which puts it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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