Spotify Technology (NYSE:SPOT) Trading 4.7% Higher - Here's Why

Key Points

• Spotify shares rose 4.7% to $552.21, trading above both the 50-day and 200-day moving averages, although volume was about 75% below the average session level.
• Analysts maintain a “Moderate Buy” consensus, with an average price target of $609.05; 19 analysts rate the stock Buy or Strong Buy, while six recommend Hold.
• Quarterly revenue increased 13.9% year over year to $5.45 billion, but earnings of $3.03 per share and revenue both narrowly missed estimates. Insiders have sold $36.2 million of stock over the past 90 days, while institutional investors own 84.09% of shares.

Spotify Technology (NYSE:SPOT - Get Free Report) rose 4.7% during trading on Friday . The stock traded as high as $553.29 and last traded at $552.21. Approximately 589,330 shares were traded during mid-day trading, a decline of 75% from the average session volume of 2,344,824 shares. The stock had previously closed at $527.25.

Wall Street Analysts Forecast Growth

A number of equities analysts have weighed in on the company. Rosenblatt Securities reduced their price target on Spotify Technology from $531.00 to $527.00 and set a "neutral" rating for the company in a research report on Wednesday, August 5th. Barclays boosted their price objective on shares of Spotify Technology from $500.00 to $565.00 and gave the stock an "overweight" rating in a research report on Friday, May 22nd. UBS Group reduced their target price on shares of Spotify Technology from $735.00 to $690.00 and set a "buy" rating for the company in a report on Friday, July 10th. Guggenheim reaffirmed a "buy" rating and issued a $565.00 target price on shares of Spotify Technology in a research report on Wednesday, August 5th. Finally, Wells Fargo & Company decreased their target price on shares of Spotify Technology from $600.00 to $570.00 and set an "overweight" rating for the company in a research report on Thursday, July 9th. Two analysts have rated the stock with a Strong Buy rating, seventeen have given a Buy rating and six have issued a Hold rating to the stock. Based on data from MarketBeat, Spotify Technology presently has a consensus rating of "Moderate Buy" and an average target price of $609.05.

Spotify Technology Price Performance

The firm has a 50-day moving average of $492.07 and a 200 day moving average of $488.29. The stock has a market capitalization of $112.71 billion, a price-to-earnings ratio of 34.09, a PEG ratio of 1.35 and a beta of 1.58.

Spotify Technology (NYSE:SPOT - Get Free Report) last posted its quarterly earnings results on Tuesday, August 4th. The company reported $3.03 earnings per share for the quarter, missing the consensus estimate of $3.16 by ($0.13). Spotify Technology had a return on equity of 41.39% and a net margin of 18.44%.The company had revenue of $5.45 billion for the quarter, compared to analyst estimates of $5.47 billion. During the same period last year, the firm earned ($0.42) EPS. The firm's revenue for the quarter was up 13.9% compared to the same quarter last year. On average, equities analysts forecast that Spotify Technology will post 14.3 earnings per share for the current year.

Insiders Place Their Bets

In other Spotify Technology news, CEO Alex Norstrom sold 5,436 shares of the stock in a transaction on 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 owned 66,773 shares in the company, valued at $33,526,723.30. This trade represents a 7.53% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. 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 stock in a transaction on Tuesday, June 2nd. The shares were sold at an average price of $496.52, for a total transaction of $10,344,001.16. Following the completion of the sale, the chief executive officer owned 20,376 shares of the company's stock, valued at approximately $10,117,091.52. This represents a 50.55% decrease in their position. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 73,371 shares of company stock worth $36,222,251. 0.40% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of the company. Principal Financial Group Inc. raised its stake in Spotify Technology by 12.9% in the 4th quarter. Principal Financial Group Inc. now owns 645,196 shares of the company's stock valued at $374,672,000 after acquiring an additional 73,722 shares during the period. SBI Okasan Asset Management Co.Ltd. bought a new position in Spotify Technology during the fourth quarter worth $1,162,000. Sycale Advisors NY LLC boosted its position in Spotify Technology by 89.6% during the fourth quarter. Sycale Advisors NY LLC now owns 36,075 shares of the company's stock worth $20,949,000 after purchasing an additional 17,050 shares during the period. Robeco Schweiz AG increased its holdings in shares of Spotify Technology by 37.6% in the fourth quarter. Robeco Schweiz AG now owns 18,544 shares of the company's stock valued at $10,769,000 after purchasing an additional 5,071 shares during the last quarter. Finally, HS Management Partners LLC acquired a new position in shares of Spotify Technology in the second quarter valued at $13,404,000. 84.09% of the stock is currently owned by institutional investors and hedge funds.

About Spotify Technology

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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