UBS Lifts Spotify (SPOT) Price Target, Maintains Buy Rating

Spotify Technology S.A. (NYSE:SPOT) is one of the 11 Best Foreign Stocks to Buy According to Hedge Funds. On June 27, UBS increased its price target for Spotify Technology S.A. (NYSE:SPOT) from $680 to $895 while keeping a “Buy” rating.

The research firm highlighted several growth catalysts for the company. These include Spotify Technology S.A. (NYSE:SPOT) expanding its audiobook offerings into new markets, launching new subscription tiers, increasing prices, and growing advertising revenue.

UBS expects these factors can help Spotify Technology S.A. (NYSE:SPOT) improve monetization and maintain about 16% foreign-exchange-neutral revenue growth through 2028.

The firm also believes that the company’s increasing focus on non-music content and cost management can further improve margins. UBS projects Spotify Technology S.A.’s (NYSE:SPOT) operating margin to reach 20% in 2027. This is above the market consensus of 17.5%.

UBS analysts expect increased cash generation from these improvements, which could give Spotify Technology S.A. (NYSE:SPOT) more flexibility to return value to shareholders through different capital allocation strategies.

Spotify Technology S.A. (NYSE:SPOT) is a Swedish company that operates the largest audio streaming subscription service in the world. It offers access to millions of songs, podcasts, and audiobooks through its platform.

While we acknowledge the potential of SPOT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.