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

Zacks Equity Research
·2 min read

Spotify (SPOT) closed the most recent trading day at $347.01, moving +0.85% from the previous trading session. This change outpaced the S&P 500's 0.04% gain on the day. Elsewhere, the Dow gained 0.19%, while the tech-heavy Nasdaq added 0.28%.

Coming into today, shares of the music-streaming service operator had gained 7.41% in the past month. In that same time, the Business Services sector gained 2.91%, while the S&P 500 gained 3.84%.

SPOT will be looking to display strength as it nears its next earnings release, which is expected to be February 3, 2021. The company is expected to report EPS of -$0.82, up 34.92% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.53 billion, up 23.17% from the year-ago period.

Investors should also note any recent changes to analyst estimates for SPOT. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. The Zacks Consensus EPS estimate has moved 0.34% higher within the past month. SPOT 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 125, which puts it in the top 50% of all 250+ industries.

The Zacks Industry Rank includes is listed in order 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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Zacks Investment Research