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Spotify (SPOT) Stock Falls Amid Market Uptick: What Investors Need to Know

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In the latest trading session, Spotify (SPOT - Free Report) closed at $384.50, marking a -0.16% move from the previous day. The stock's performance was behind the S&P 500's daily gain of 0.41%. Meanwhile, the Dow experienced a rise of 0.69%, and the technology-dominated Nasdaq saw an increase of 0.8%.

The the stock of music-streaming service operator has risen by 3.35% in the past month, leading the Business Services sector's gain of 0.16% and the S&P 500's loss of 0.97%.

The upcoming earnings release of Spotify will be of great interest to investors. The company's earnings report is expected on November 12, 2024. The company is expected to report EPS of $1.74, up 383.33% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.38 billion, up 19.81% from the prior-year quarter.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $6.19 per share and a revenue of $17.11 billion, signifying shifts of +309.83% and +19.39%, respectively, from the last year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Spotify. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.71% lower. At present, Spotify boasts a Zacks Rank of #3 (Hold).

Investors should also note Spotify's current valuation metrics, including its Forward P/E ratio of 62.19. For comparison, its industry has an average Forward P/E of 25.37, which means Spotify is trading at a premium to the group.

The Technology Services industry is part of the Business Services sector. This industry, currently bearing a Zacks Industry Rank of 68, finds itself in the top 27% echelons of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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