Spotify price target raised to $675 from $600 at KeyBanc

KeyBanc analyst Justin Patterson raised the firm’s price target on Spotify (SPOT) to $675 from $600 and keeps an Overweight rating on the shares. Spotify has demonstrated meaningful margin progress, with operating margin expanding from (5.6%) in 2022 to 8.7% in 2024. While KeyBanc does not expect the same degree of progression from here, its view is that a near-term focus on quarter-over-quarter gross margin and operating margin misses the big picture. Spotify has proven music and non-music investments can drive engagement and pricing, and the firm believes the company is leaning into that formula.