SPOT - Netflix And Spotify Soar In Ratings But What's Next for Match Group? | Benzinga
More app and entertainment businesses are transitioning from user or payer growth stories to pricing stories.
That's according to KeyBanc analyst Justin Patterson, citing the history of Netflix Inc (NASDAQ: NFLX). This goes smoothly when engagement metrics are improving (often due to product and content quality).
Patterson feels most confident about Overweight-rated Netflix (raised price target to $525 from $510) and Spotify Technology SA (NYSE: SPOT) (maintained price target of $255), given proven pricing power and product leadership.
Spotify can sustain at least mid-teens annual revenue growth through pricing (new plans and price increases), subscriber growth, ad monetization, and new verticals.
With Netflix improving its licensed content mix, scaling its ad-supported tier, and competition rationalizing, he expects ...