Monness analyst Brian White has maintained their neutral stance on SPOT stock, giving a Hold rating on January 30.
Brian White has given his Hold rating due to a combination of factors relating to Spotify’s performance and future prospects. Despite Spotify’s impressive ability to leverage a lucrative digital ad market and benefit from an improved cost structure, the company faces intense competition, which could pressure its margins. The recent financial results showed a deceleration in growth, with revenue increasing by 16% year-over-year, slightly above expectations, but earnings per share falling short of projections.
Additionally, the growth in premium subscribers, although positive, marked the slowest rate on record, which raises concerns about future user acquisition momentum. While Spotify’s strategic plans for 2025 include accelerated execution and the introduction of new product tiers, the current valuation appears stretched, and the broader economic environment remains fragile. Consequently, these factors collectively justify a cautious stance, warranting the Hold rating.
In another report released on January 30, Citi also maintained a Hold rating on the stock with a $540.00 price target.