Spotify Technology (NYSE:SPOT) Stock Price Down 4.4% - Here's Why

Key Points

• Spotify shares fell 4.4% to about $525.58 in midday trading, with volume roughly 70% below the average session level.
• Analysts remain broadly positive, with a consensus “Moderate Buy” rating and an average price target of $609.05, despite one recent downgrade to “Hold.”
• Spotify slightly missed quarterly earnings and revenue estimates, reporting $3.03 in EPS and $5.45 billion in revenue, although revenue increased 13.9% year over year. Insiders sold shares primarily to cover tax obligations tied to equity awards.

Spotify Technology (NYSE:SPOT - Get Free Report) traded down 4.4% on Thursday . The stock traded as low as $524.91 and last traded at $525.5830. Approximately 715,591 shares traded hands during mid-day trading, a decline of 70% from the average session volume of 2,349,447 shares. The stock had previously closed at $550.03.

Wall Street Analysts Forecast Growth

Several analysts have commented on the stock. Barclays upped their target price on shares of Spotify Technology from $500.00 to $565.00 and gave the company an "overweight" rating in a research report on Friday, May 22nd. Morgan Stanley raised their price target on Spotify Technology from $590.00 to $610.00 and gave the stock an "overweight" rating in a research report on Friday, May 22nd. Wall Street Zen downgraded Spotify Technology from a "buy" rating to a "hold" rating in a report on Saturday, July 25th. JPMorgan Chase & Co. increased their target price on Spotify Technology from $600.00 to $650.00 and gave the company an "overweight" rating in a research note on Friday, May 22nd. Finally, KeyCorp reduced their target price on Spotify Technology from $745.00 to $680.00 and set an "overweight" rating on the stock in a report on Wednesday, April 29th. Two analysts have rated the stock with a Strong Buy rating, seventeen have assigned a Buy rating and six have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and a consensus price target of $609.05.

Spotify Technology Stock Down 4.2%

The firm has a market capitalization of $108.47 billion, a P/E ratio of 32.80, a P/E/G ratio of 1.35 and a beta of 1.58. The stock has a fifty day moving average of $490.90 and a 200-day moving average of $487.55.

Spotify Technology (NYSE:SPOT - Get Free Report) last announced its quarterly earnings data on Tuesday, August 4th. The company reported $3.03 EPS for the quarter, missing analysts' consensus estimates of $3.16 by ($0.13). Spotify Technology had a return on equity of 41.39% and a net margin of 18.44%.The business had revenue of $5.45 billion during the quarter, compared to the consensus estimate of $5.47 billion. During the same period in the prior year, the firm earned ($0.42) EPS. The business's revenue for the quarter was up 13.9% compared to the same quarter last year. Sell-side analysts predict that Spotify Technology will post 14.3 EPS for the current fiscal year.

Insider Buying and Selling

In related news, CEO Alex Norstrom sold 5,436 shares of the firm's stock in a transaction dated Monday, August 3rd. The shares were sold at an average price of $502.10, for a total value of $2,729,415.60. Following the completion of the sale, the chief executive officer directly owned 66,773 shares in the company, valued at approximately $33,526,723.30. This trade represents a 7.53% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Gustav Soderstrom sold 20,833 shares of the firm's stock in a transaction that occurred on Monday, August 3rd. The shares were sold at an average price of $507.24, for a total value of $10,567,330.92. Following the completion of the sale, the chief executive officer directly owned 20,142 shares of the company's stock, valued at approximately $10,216,828.08. The trade was a 50.84% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 73,371 shares of company stock worth $36,222,251. Company insiders own 0.40% of the company's stock.

Hedge Funds Weigh In On Spotify Technology

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in SPOT. Sivia Capital Partners LLC bought a new stake in shares of Spotify Technology during the 2nd quarter worth about $312,000. Jump Financial LLC lifted its position in Spotify Technology by 5.2% during the second quarter. Jump Financial LLC now owns 1,132 shares of the company's stock worth $869,000 after acquiring an additional 56 shares during the last quarter. Cary Street Partners Financial LLC acquired a new stake in Spotify Technology during the second quarter worth approximately $178,000. NewEdge Advisors LLC boosted its holdings in shares of Spotify Technology by 36.9% during the second quarter. NewEdge Advisors LLC now owns 12,650 shares of the company's stock worth $9,707,000 after acquiring an additional 3,412 shares during the period. Finally, Glenview Trust co bought a new stake in shares of Spotify Technology during the second quarter worth approximately $298,000. 84.09% of the stock is owned by institutional investors.

Spotify Technology Company Profile

Spotify Technology is a digital audio streaming company best known for its on-demand music service and a growing portfolio of spoken-word content. Founded in Sweden in 2006 by Daniel Ek and Martin Lorentzon and launched commercially in 2008, the company offers a cross-platform app that enables users to discover, stream and organize music, podcasts and other audio. Its primary consumer products include a free, ad-supported tier and a paid Spotify Premium subscription that provides ad-free listening, offline playback and higher-quality audio streams.

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