Is Spotify Stock Going to $425? 1 Wall Street Analyst Thinks So.
Spotify's (NYSE: SPOT) recent second-quarter earnings release was music to the ears of many investors. The streaming service convincingly beat the average bottom-line estimate while delivering robust growth where it counted. In the wake of that release, several analysts raised their price targets on the high-profile music streamer. One even went so far as to upgrade his recommendation on its stock.
Less than 24 hours after Spotify posted its Q2 results on Monday, Goldman Sachs (NYSE: GS) prognosticator Eric Sheridan changed his recommendation on the stock to buy from his previous neutral. Additionally, he raised his price target to $425 per share from his preceding level of $320.
Sheridan wrote in a new note that the company is "the clear global audio platform leader." He believes this will translate into continued user growth and rising engagement, and consequently stronger pricing power. The analyst also said that restructuring efforts by management are starting to pay off, and the company's very robust free cash flow should give it scope to return capital to shareholders within the next 18 months.
Source Fool.com
