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Spotify (SPOT) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, Spotify (SPOT) closed at $99.27, marking a +1.45% move from the previous day. This change outpaced the S&P 500’s 0.22% gain on the day. At the same time, the Dow lost 0.13%, and the tech-heavy Nasdaq gained 0.2%.

Coming into today, shares of the music-streaming service operator had lost 7.49% in the past month. In that same time, the Business Services sector lost 7.62%, while the S&P 500 lost 8.32%.

Investors will be hoping for strength from Spotify as it approaches its next earnings release. The company is expected to report EPS of -$0.68, down 195.65% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3 billion, up 6.83% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of -$0.78 per share and revenue of $12.43 billion. These totals would mark changes of +36.07% and +8.87%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for Spotify. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 32.2% lower. Spotify is currently sporting a Zacks Rank of #3 (Hold).

The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 177, which puts it in the bottom 31% 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.

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

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