Canaccord Maintains Buy Rating on Spotify (SPOT), Lifts PT

On May 20, Canaccord increased the price target on Spotify Technology S.A. (NYSE:SPOT) stock from $700 to $775, keeping a Buy rating on the stock.

Maria Ripps from Canaccord increased the price target after reviewing the Q1 FY2025 quarterly results of the music giant. Ripps mentioned that the earnings for the internet sector continue to favor top names with diversified business models that are less exposed to tariffs.

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Despite missing the earnings estimate in Q1, Spotify Technology S.A. (NYSE:SPOT) reported strong subscriber growth, with the highest first-quarter net addition of 5 million since 2020, representing 12% growth year-over-year.

Ripps cited that Spotify has multiple levers to mitigate any potential risk from tariffs. The company has expanded its Partner Program to nine new markets during Q1 and also paid out over $100 million to podcast creators during the quarter. Moreover, Spotify posted a 31.6% gross margin in Q1, exceeding guidance and growing by 400 basis points year-over-year.

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Disclosure. None.