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KeyBanc Capital Markets has become more optimistic about Spotify Technology, predicting further gains in the streaming music platform’s stock.
Analyst Justin Patterson on Monday reaffirmed his overweight rating on the stock, raising his price forecast to $160 from $140.
Analysts cited a recent survey of 1,041 US consumers…
KeyBanc Capital Markets has become more optimistic about Spotify Technology, predicting further gains in the streaming music platform’s stock.
Analyst Justin Patterson on Monday reaffirmed his overweight rating on the stock, raising his price forecast to $160 from $140.
Analysts cited a recent survey of 1,041 US consumers on their audio habits. The percentage of respondents who say they use Spotify is about 36%, up 2 percentage points from the previous quarter.
“We doubt this … This reflects the momentum of Spotify ending Q4 and the continued strength of MAU [monthly active users],” he wrote.
In late trading on Tuesday, Spotify’s shares were up 0.6% to $134.64. Spotify’s stock price has been roughly even over the past 12 months.
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Patterson also said Spotify customers are less likely to cancel than they were in the three months before the study. He said the company may increase prices in the future due to the service’s strong findings.
“Low cancellation intentions suggest that consumers are sticking to their music plans,” he wrote, making the service “fairly resilient” to the effects of the economic downturn. He added that it could mean that
Wall Street analysts have mixed opinions about Spotify. According to FactSet, about half are rated Buy or Equal, and the other half are rated Hold.
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Write to Tae Kim at tae.kim@barrons.com.
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