PhillipCapital downgrades Spotify on valuation concerns

Investing.com -- PhillipCapital downgraded Spotify Technology SA (NYSE: SPOT) to “Neutral” from “Accumulate” on limited upside after recent share price gains, despite strong fourth-quarter results.

Spotify’s Q4 revenue grew 16% year-over-year, with net margin expanding by 5.5 percentage points. Monthly active users (MAUs) reached 675 million, exceeding guidance by 10 million, while premium subscribers rose 11% to 263 million.

The firm raised its price target to $600 from $485 but kept its 2025 financial assumptions unchanged. While Spotify remains the leader in audio streaming with a growing subscriber base and cost efficiencies, PhillipCapital sees the stock as fully valued at current levels.

“SPOT continues to be the industry leader in audio streaming with its growing subscriber base, lower cost structure, and pricing power. Yet we do not see much upside due to full valuations,” analyst said.

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