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Spotify (SPOT) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Spotify (SPOT) closed at $151.81 in the latest trading session, marking a -0.42% move from the prior day. This change lagged the S&P 500's daily gain of 0.84%. Elsewhere, the Dow gained 0.92%, while the tech-heavy Nasdaq added 1.06%.

Coming into today, shares of the music-streaming service operator had gained 1.05% in the past month. In that same time, the Business Services sector gained 2.8%, while the S&P 500 gained 3.95%.

Investors will be hoping for strength from SPOT as it approaches its next earnings release, which is expected to be February 5, 2020. The company is expected to report EPS of -$0.48, down 217.07% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.09 billion, up 22.57% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for SPOT. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. SPOT currently has a Zacks Rank of #3 (Hold).

The Technology Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 160, putting it in the bottom 38% 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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