In the latest trading session, Spotify (SPOT) closed at $502.19, marking a -1.79% move from the previous day. The stock's performance was behind the S&P 500's daily gain of 1.16%. Meanwhile, the Dow gained 1.21%, and the Nasdaq, a tech-heavy index, added 1.18%.
The music-streaming service operator's stock has dropped by 11.75% in the past month, falling short of the Computer and Technology sector's loss of 1.07% and the S&P 500's loss of 0.42%.
Analysts and investors alike will be keeping a close eye on the performance of Spotify in its upcoming earnings disclosure. The company's earnings report is set to go public on February 10, 2026. The company's earnings per share (EPS) are projected to be $2.97, reflecting a 57.98% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $5.13 billion, indicating a 13.43% upward movement from the same quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $7.7 per share and a revenue of $19.65 billion, indicating changes of +29.41% and 0%, respectively, from the former year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Spotify. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 5.37% fall in the Zacks Consensus EPS estimate. Right now, Spotify possesses a Zacks Rank of #3 (Hold).
In terms of valuation, Spotify is presently being traded at a Forward P/E ratio of 38. Its industry sports an average Forward P/E of 22.98, so one might conclude that Spotify is trading at a premium comparatively.
One should further note that SPOT currently holds a PEG ratio of 0.97. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Internet - Software industry had an average PEG ratio of 1.39.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 66, positioning it in the top 27% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Spotify Technology (SPOT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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