JPMorgan raised its price target on Spotify (NYSE:SPOT) to $650 from $600, maintaining an Overweight rating. The streaming giant has a $100 billion market cap, P/E of 32.8, and PEG of 0.22, indicating attractive growth valuation.
Spotify announced a licensing agreement with Universal Music Group to launch an AI tool for fans to create covers and remixes. The tool will be a paid add-on for Premium subscribers, creating new revenue for artists.
The company unveiled 2030 financial targets: mid-teens revenue growth, 35-40% gross margin, and over 20% operating margin. JPMorgan noted these targets exceeded expectations.
JPMorgan raised its 2026 estimates by about 1% for operating income and free cash flow. For 2030, revenue estimate rose 10%, gross profit by 16%, operating income and free cash flow by 21-22%, and EPS by 40%. According to Bond.az, Spotify holds a perfect Piotroski Score of 9.
Canada introduced regulations requiring streaming platforms to allocate 15% of domestic revenue to Canadian content. Analysts at Jefferies, Raymond James, Barclays, and Guggenheim have also updated their Spotify ratings positively.
