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Spotify (SPOT) Declines More Than Market: Some Information for Investors

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Spotify (SPOT - Free Report) closed at $313.79 in the latest trading session, marking a -0.5% move from the prior day. This move lagged the S&P 500's daily loss of 0.41%. At the same time, the Dow lost 0.12%, and the tech-heavy Nasdaq lost 0.71%.

Shares of the music-streaming service operator have appreciated by 3.51% over the course of the past month, outperforming the Business Services sector's gain of 0.6% and lagging the S&P 500's gain of 3.53%.

Investors will be eagerly watching for the performance of Spotify in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on July 23, 2024. The company's earnings per share (EPS) are projected to be $1.12, reflecting a 166.27% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $4.1 billion, indicating a 18.5% upward movement from the same quarter last year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $4.95 per share and a revenue of $16.87 billion, signifying shifts of +267.8% and +17.77%, respectively, from the last year.

Any recent changes to analyst estimates for Spotify should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research demonstrates that these adjustments in estimates directly associate with imminent 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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.46% increase. Currently, Spotify is carrying a Zacks Rank of #1 (Strong Buy).

Digging into valuation, Spotify currently has a Forward P/E ratio of 63.68. This denotes a premium relative to the industry's average Forward P/E of 23.02.

The Technology Services industry is part of the Business Services sector. Currently, this industry holds a Zacks Industry Rank of 62, positioning it in the top 25% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow SPOT in the coming trading sessions, be sure to utilize Zacks.com.


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