Morgan Stanley analyst Benjamin Swinburne has reiterated their bullish stance on SPOT stock, giving a Buy rating today.
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Benjamin Swinburne has given his Buy rating due to a combination of factors that highlight Spotify’s strong growth potential and strategic positioning. The company’s product innovation is significantly contributing to user growth and engagement, which supports a sustainable revenue growth trajectory in the low to mid-teens. This growth is further bolstered by Spotify’s ability to expand its margins through product enhancements and diversification into higher-margin areas.
Additionally, Swinburne points out that Spotify’s accelerated product development is leading to faster user acquisition, as evidenced by the impressive increase in monthly active users. The company’s strategic moves, such as leveraging generative AI for improved personalization and cost efficiencies, are expected to drive substantial EBIT growth through 2028. These factors collectively reinforce the view that Spotify is well-positioned for long-term profitability, making it a top pick in the media and entertainment sector.
Swinburne covers the Communication Services sector, focusing on stocks such as Spotify, TKO Group Holdings, and T Mobile US. According to TipRanks, Swinburne has an average return of 11.7% and a 55.79% success rate on recommended stocks.
In another report released today, Barclays also maintained a Buy rating on the stock with a $700.00 price target.