SPOTIFY TECHNOLOGY SA (SPOT)
LU1778762911 - Common Stock
We assign a fundamental rating of 5 out of 10 to SPOT. SPOT was compared to 76 industry peers in the Entertainment industry. SPOT has an excellent financial health rating, but there are some minor concerns on its profitability. SPOT is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
In the past year SPOT was profitable.
SPOT had a positive operating cash flow in the past year.
SPOT had negative earnings in each of the past 5 years.
SPOT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of SPOT (-1.21%) is better than 60.53% of its industry peers.
SPOT's Return On Equity of -3.32% is fine compared to the rest of the industry. SPOT outperforms 63.16% of its industry peers.
SPOT's Return On Invested Capital of 2.61% is fine compared to the rest of the industry. SPOT outperforms 65.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.21% | ||
| ROE | -3.32% | ||
| ROIC | 2.61% |
ROA(3y)-4.16%
ROA(5y)-5.06%
ROE(3y)-13.53%
ROE(5y)-14.09%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Operating Margin, with a value of 1.22%, SPOT is in the better half of the industry, outperforming 64.47% of the companies in the same industry.
SPOT has a worse Gross Margin (26.40%) than 65.79% of its industry peers.
SPOT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.22% | ||
| PM (TTM) | N/A | ||
| GM | 26.4% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.31%
GM growth 5Y0.06%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so SPOT is destroying value.
SPOT has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, SPOT has more shares outstanding
Compared to 1 year ago, SPOT has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 7.26 indicates that SPOT is not in any danger for bankruptcy at the moment.
SPOT has a better Altman-Z score (7.26) than 96.05% of its industry peers.
The Debt to FCF ratio of SPOT is 2.14, which is a good value as it means it would take SPOT, 2.14 years of fcf income to pay off all of its debts.
SPOT has a Debt to FCF ratio of 2.14. This is amongst the best in the industry. SPOT outperforms 86.84% of its industry peers.
A Debt/Equity ratio of 0.53 indicates that SPOT is somewhat dependend on debt financing.
SPOT's Debt to Equity ratio of 0.53 is in line compared to the rest of the industry. SPOT outperforms 47.37% of its industry peers.
Even though the debt/equity ratio score it not favorable for SPOT, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 2.14 | ||
| Altman-Z | 7.26 |
ROIC/WACC0.36
WACC7.29%
2.3 Liquidity
SPOT has a Current Ratio of 1.42. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of SPOT (1.42) is better than 65.79% of its industry peers.
SPOT has a Quick Ratio of 1.42. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.42, SPOT is in the better half of the industry, outperforming 67.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.42 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 103.07% over the past year.
Looking at the last year, SPOT shows a quite strong growth in Revenue. The Revenue has grown by 14.31% in the last year.
SPOT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.29% yearly.
EPS 1Y (TTM)103.07%
EPS 3YN/A
EPS 5YN/A
EPS growth Q2Q184.91%
Revenue 1Y (TTM)14.31%
Revenue growth 3Y18.9%
Revenue growth 5Y20.29%
Revenue growth Q2Q19.53%
3.2 Future
SPOT is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 50.19% yearly.
Based on estimates for the next years, SPOT will show a quite strong growth in Revenue. The Revenue will grow by 14.32% on average per year.
EPS Next Y288.37%
EPS Next 2Y117.86%
EPS Next 3Y76.94%
EPS Next 5Y50.19%
Revenue Next Year16.82%
Revenue Next 2Y15.25%
Revenue Next 3Y14.17%
Revenue Next 5Y14.32%
3.3 Evolution
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 1991.07, the valuation of SPOT can be described as expensive.
SPOT's Price/Earnings ratio is in line with the industry average.
SPOT is valuated expensively when we compare the Price/Earnings ratio to 28.31, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 50.36, the valuation of SPOT can be described as expensive.
Based on the Price/Forward Earnings ratio, SPOT is valued a bit cheaper than the industry average as 69.74% of the companies are valued more expensively.
SPOT is valuated expensively when we compare the Price/Forward Earnings ratio to 20.48, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1991.07 | ||
| Fwd PE | 50.36 |
4.2 Price Multiples
SPOT's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, SPOT is valued a bit cheaper than 69.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 66.99 | ||
| EV/EBITDA | 162.44 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as SPOT's earnings are expected to grow with 76.94% in the coming years.
PEG (NY)6.9
PEG (5Y)N/A
EPS Next 2Y117.86%
EPS Next 3Y76.94%
5. Dividend
5.1 Amount
SPOT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
SPOTIFY TECHNOLOGY SA
NYSE:SPOT (5/9/2024, 7:19:32 PM)
After market: 298.64 -0.02 (-0.01%)298.66
0.01 (0%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap59.23B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
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Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
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Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1991.07 | ||
| Fwd PE | 50.36 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)6.9
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.21% | ||
| ROE | -3.32% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 1.22% | ||
| PM (TTM) | N/A | ||
| GM | 26.4% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.42 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)103.07%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y288.37%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)14.31%
Revenue growth 3Y18.9%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y