Spotify (SPOT) closed the most recent trading day at $494.72, moving +2.5% from the previous trading session. The stock's performance was ahead of the S&P 500's daily gain of 0.02%. At the same time, the Dow added 0.51%, and the tech-heavy Nasdaq lost 0.18%.
The music-streaming service operator's stock has climbed by 4.92% in the past month, exceeding the Computer and Technology sector's loss of 4.21% and the S&P 500's gain of 0.77%.
The upcoming earnings release of Spotify will be of great interest to investors. The company's earnings report is expected on August 4, 2026. The company is forecasted to report an EPS of $3.28, showcasing a 783.33% upward movement from the corresponding quarter of the prior year. Simultaneously, our latest consensus estimate expects the revenue to be $5.58 billion, showing a 17.27% escalation compared to the year-ago quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $14.51 per share and revenue of $22.62 billion, indicating changes of +22.04% and +16.41%, respectively, compared to the previous year.
It is also important to note the recent changes to analyst estimates for Spotify. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 1.15% lower. Spotify is currently sporting a Zacks Rank of #4 (Sell).
Looking at its valuation, Spotify is holding a Forward P/E ratio of 33.26. This indicates a premium in contrast to its industry's Forward P/E of 18.86.
We can additionally observe that SPOT currently boasts a PEG ratio of 1.19. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The average PEG ratio for the Internet - Software industry stood at 1.07 at the close of the market yesterday.
The Internet - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 150, positioning it in the bottom 40% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Spotify Technology (SPOT): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).