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Guggenheim’s Michael Morris is hanging out on Wednesday with the idea of a price hike, raising his call for the music subscription service’s stock price.
Spotify (ticker: SPOT) has been charging $9.99 per month for each premium streaming service in the US since July 2011. The company increases the value of what it offers…
Guggenheim’s Michael Morris is hanging out on Wednesday with the idea of a price hike, raising his call for the music subscription service’s stock price.
Spotify (ticker: SPOT) has been charging $9.99 per month for each premium streaming service in the US since July 2011. The company increases the value of what it offers through its audiobooks and other services.
Meanwhile, starting last month, Amazon.com (AMZN) increased the price of its unlimited monthly music service from $9.99 to $10.99 for individual US members without Prime. Alphabet’s (GOOGL) YouTube increased the price of its family plan from $17.99 to $22.99 in October. Also, Apple (AAPL) raised prices for student, individual, and family plans by $1 or $2 late last year.
Spotify Has Raised Prices In Developing Countries, But Not Yet In The U.S.
Morris expects Spotify to raise prices across the regions it serves in mid-2023, and said it is poised to benefit from broader market leadership. Analysts also see Spotify managing its costs “more aggressively” as revenue from music rises.
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He upgraded the stock’s rating from Neutral to Buy and raised the stock price target from $120 to $155. This suggests a potential upside of 20% from Tuesday’s close of $128.81.
Spotify shares rose 0.4% on Wednesday.
The company did not immediately respond to a request for comment. Ek has previously said the company doesn’t want to get ahead, especially in an uncertain economic environment.
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He reminded analysts on Oct. 25 that audiobooks and ads also contribute to Spotify’s revenue, but mostly through subscriptions.
Please contact Karishma Vanjani at karishma.vanjani@dowjones.com.
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