Spotify Technology S.A. Ordinary Shares (SPOT) Company Bio
Spotify AB provides a digital music-streaming service that gives on-demand access of songs on devices, computers, mobiles, tablets, and home entertainment systems. Its services allow subscribers to search and discover music collections of friends, artists, and celebrities; build a personal collection playlist; and share music on Spotify, Facebook, Twitter, blog, and via email with friends. It also offers research and development services in Sweden. The company was founded in 2008 and is based in Stockholm, Sweden. Spotify AB operates as a subsidiary of Spotify Limited.
SPOT Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Spotify Technology SA. To summarize, we found that Spotify Technology SA ranked in the 70th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 224%. In terms of the factors that were most noteworthy in this DCF analysis for SPOT, they are:
The compound growth rate in the free cash flow of Spotify Technology SA over the past 1.96 years is 0.84%; that's higher than 84.94% of free cash flow generating stocks in the Technology sector.
The business' balance sheet suggests that 3% of the company's capital is sourced from debt; this is greater than only 9.65% of the free cash flow producing stocks we're observing.
Spotify Technology SA's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 0.61. This coverage rate is greater than that of only 22.41% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Spotify Technology SA? See TSEM, EXTR, ECOM, WIX, and BABA.