KeyBanc analyst Justin Patterson reiterated an Overweight rating on Spotify Technology SA (NYSE:SPOT) with a price target of 410, up from $400.
Patterson updated his model and framed vital factors to watch ahead of the print.
Given recent pricing changes, the analyst noted that the consensus may be too aggressive on third-quarter Premium Subscriber net adds.
While Patterson is mindful that near-term net add guidance can weigh on the stock, he noted that this misses the bigger picture.
The consensus appears too conservative on 2025 – 2026 revenue growth, gross margin, and operating margin, and valuation remains favorable for a consumer staple with pricing power, as per the analyst.
The analyst raised his 2024, 2025, and 2026 revenue by ~1% annually.
Also Read: Spotify Discontinues Car Thing Device, Shifts Focus to New User Features
Patterson now expects 15.6 billion euros, 18.3 billion euros, and 20.9 billion euros, reflecting higher Premium revenue from pricing and plan ...