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SPOTIFY TECHNOLOGY SA (SPOT) Stock Fundamental Analysis

NYSE:SPOT - New York Stock Exchange, Inc. - LU1778762911 - Common Stock - Currency: USD

709.14  +15.82 (+2.28%)

After market: 704.896 -4.24 (-0.6%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to SPOT. SPOT was compared to 72 industry peers in the Entertainment industry. SPOT has an excellent financial health rating, but there are some minor concerns on its profitability. SPOT has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year SPOT was profitable.
In the past year SPOT had a positive cash flow from operations.
SPOT had negative earnings in 4 of the past 5 years.
In the past 5 years SPOT always reported a positive cash flow from operatings.
SPOT Yearly Net Income VS EBIT VS OCF VS FCFSPOT Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B -1B 2B

1.2 Ratios

The Return On Assets of SPOT (9.19%) is better than 91.67% of its industry peers.
The Return On Equity of SPOT (18.66%) is better than 88.89% of its industry peers.
SPOT's Return On Invested Capital of 21.54% is amongst the best of the industry. SPOT outperforms 95.83% of its industry peers.
Industry RankSector Rank
ROA 9.19%
ROE 18.66%
ROIC 21.54%
ROA(3y)-0.84%
ROA(5y)-2.44%
ROE(3y)-6.13%
ROE(5y)-8.14%
ROIC(3y)N/A
ROIC(5y)N/A
SPOT Yearly ROA, ROE, ROICSPOT Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200 -200 -400

1.3 Margins

SPOT has a better Profit Margin (7.19%) than 83.33% of its industry peers.
SPOT has a Operating Margin of 10.51%. This is in the better half of the industry: SPOT outperforms 79.17% of its industry peers.
SPOT's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 31.10%, SPOT is not doing good in the industry: 65.28% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of SPOT has grown nicely.
Industry RankSector Rank
OM 10.51%
PM (TTM) 7.19%
GM 31.1%
OM growth 3Y107.65%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y4.12%
GM growth 5Y3.51%
SPOT Yearly Profit, Operating, Gross MarginsSPOT Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20

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7

2. Health

2.1 Basic Checks

SPOT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, SPOT has more shares outstanding
The number of shares outstanding for SPOT has been increased compared to 5 years ago.
Compared to 1 year ago, SPOT has an improved debt to assets ratio.
SPOT Yearly Shares OutstandingSPOT Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M 200M
SPOT Yearly Total Debt VS Total AssetsSPOT Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B 10B

2.2 Solvency

SPOT has an Altman-Z score of 13.25. This indicates that SPOT is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 13.25, SPOT belongs to the best of the industry, outperforming 94.44% of the companies in the same industry.
SPOT has a debt to FCF ratio of 0.81. This is a very positive value and a sign of high solvency as it would only need 0.81 years to pay back of all of its debts.
SPOT's Debt to FCF ratio of 0.81 is amongst the best of the industry. SPOT outperforms 84.72% of its industry peers.
SPOT has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
SPOT has a Debt to Equity ratio of 0.07. This is in the better half of the industry: SPOT outperforms 63.89% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.07
Debt/FCF 0.81
Altman-Z 13.25
ROIC/WACC2.83
WACC7.6%
SPOT Yearly LT Debt VS Equity VS FCFSPOT Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 1B 2B 3B 4B 5B

2.3 Liquidity

SPOT has a Current Ratio of 1.48. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
SPOT has a better Current ratio (1.48) than 65.28% of its industry peers.
SPOT has a Quick Ratio of 1.48. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
SPOT has a better Quick ratio (1.48) than 70.83% of its industry peers.
Industry RankSector Rank
Current Ratio 1.48
Quick Ratio 1.48
SPOT Yearly Current Assets VS Current LiabilitesSPOT Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B

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6

3. Growth

3.1 Past

SPOT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 4575.00%, which is quite impressive.
Looking at the last year, SPOT shows a quite strong growth in Revenue. The Revenue has grown by 17.24% in the last year.
The Revenue has been growing by 18.30% on average over the past years. This is quite good.
EPS 1Y (TTM)4575%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%10.31%
Revenue 1Y (TTM)17.24%
Revenue growth 3Y17.47%
Revenue growth 5Y18.3%
Sales Q2Q%15.24%

3.2 Future

The Earnings Per Share is expected to grow by 28.28% on average over the next years. This is a very strong growth
SPOT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.55% yearly.
EPS Next Y59.35%
EPS Next 2Y52.77%
EPS Next 3Y43.02%
EPS Next 5Y28.28%
Revenue Next Year13.7%
Revenue Next 2Y14.78%
Revenue Next 3Y14.32%
Revenue Next 5Y12.55%

3.3 Evolution

The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
SPOT Yearly Revenue VS EstimatesSPOT Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 10B 20B 30B 40B
SPOT Yearly EPS VS EstimatesSPOT Yearly EPS VS EstimatesYearly EPS VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 0 10 20 30

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4

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 110.63, the valuation of SPOT can be described as expensive.
SPOT's Price/Earnings ratio is a bit cheaper when compared to the industry. SPOT is cheaper than 65.28% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.55. SPOT is valued rather expensively when compared to this.
SPOT is valuated quite expensively with a Price/Forward Earnings ratio of 48.25.
SPOT's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of SPOT to the average of the S&P500 Index (22.40), we can say SPOT is valued expensively.
Industry RankSector Rank
PE 110.63
Fwd PE 48.25
SPOT Price Earnings VS Forward Price EarningsSPOT Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80 100

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SPOT is on the same level as its industry peers.
62.50% of the companies in the same industry are more expensive than SPOT, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 48.65
EV/EBITDA 63.35
SPOT Per share dataSPOT EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60 80

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of SPOT may justify a higher PE ratio.
SPOT's earnings are expected to grow with 43.02% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.86
PEG (5Y)N/A
EPS Next 2Y52.77%
EPS Next 3Y43.02%

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0

5. Dividend

5.1 Amount

SPOT does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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SPOTIFY TECHNOLOGY SA

NYSE:SPOT (6/11/2025, 8:19:56 PM)

After market: 704.896 -4.24 (-0.6%)

709.14

+15.82 (+2.28%)

Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)04-29 2025-04-29/bmo
Earnings (Next)07-23 2025-07-23/bmo
Inst Owners67.74%
Inst Owner Change2.45%
Ins Owners16.27%
Ins Owner ChangeN/A
Market Cap145.17B
Analysts76.96
Price Target666 (-6.08%)
Short Float %4.4%
Short Ratio2.69
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-32.7%
Min EPS beat(2)-52.29%
Max EPS beat(2)-13.1%
EPS beat(4)1
Avg EPS beat(4)-14.82%
Min EPS beat(4)-52.29%
Max EPS beat(4)23.46%
EPS beat(8)4
Avg EPS beat(8)45.94%
EPS beat(12)4
Avg EPS beat(12)23.18%
EPS beat(16)7
Avg EPS beat(16)27.54%
Revenue beat(2)0
Avg Revenue beat(2)-1.52%
Min Revenue beat(2)-2.29%
Max Revenue beat(2)-0.75%
Revenue beat(4)0
Avg Revenue beat(4)-2.05%
Min Revenue beat(4)-2.8%
Max Revenue beat(4)-0.75%
Revenue beat(8)0
Avg Revenue beat(8)-2.07%
Revenue beat(12)0
Avg Revenue beat(12)-1.92%
Revenue beat(16)1
Avg Revenue beat(16)-1.48%
PT rev (1m)0.92%
PT rev (3m)3.64%
EPS NQ rev (1m)-1.53%
EPS NQ rev (3m)-5.89%
EPS NY rev (1m)-14.92%
EPS NY rev (3m)-15.31%
Revenue NQ rev (1m)-0.52%
Revenue NQ rev (3m)-2.56%
Revenue NY rev (1m)-0.52%
Revenue NY rev (3m)-2.02%
Valuation
Industry RankSector Rank
PE 110.63
Fwd PE 48.25
P/S 7.83
P/FCF 48.65
P/OCF 48.31
P/B 20.33
P/tB 25.16
EV/EBITDA 63.35
EPS(TTM)6.41
EY0.9%
EPS(NY)14.7
Fwd EY2.07%
FCF(TTM)14.58
FCFY2.06%
OCF(TTM)14.68
OCFY2.07%
SpS90.6
BVpS34.88
TBVpS28.18
PEG (NY)1.86
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 9.19%
ROE 18.66%
ROCE 25.38%
ROIC 21.54%
ROICexc N/A
ROICexgc N/A
OM 10.51%
PM (TTM) 7.19%
GM 31.1%
FCFM 16.09%
ROA(3y)-0.84%
ROA(5y)-2.44%
ROE(3y)-6.13%
ROE(5y)-8.14%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y291.99%
ROICexc growth 5YN/A
OM growth 3Y107.65%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y4.12%
GM growth 5Y3.51%
F-Score7
Asset Turnover1.28
Health
Industry RankSector Rank
Debt/Equity 0.07
Debt/FCF 0.81
Debt/EBITDA 0.25
Cap/Depr 15.38%
Cap/Sales 0.11%
Interest Coverage 42.65
Cash Conversion 144.21%
Profit Quality 223.93%
Current Ratio 1.48
Quick Ratio 1.48
Altman-Z 13.25
F-Score7
WACC7.6%
ROIC/WACC2.83
Cap/Depr(3y)10.82%
Cap/Depr(5y)33.93%
Cap/Sales(3y)0.12%
Cap/Sales(5y)0.45%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4575%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%10.31%
EPS Next Y59.35%
EPS Next 2Y52.77%
EPS Next 3Y43.02%
EPS Next 5Y28.28%
Revenue 1Y (TTM)17.24%
Revenue growth 3Y17.47%
Revenue growth 5Y18.3%
Sales Q2Q%15.24%
Revenue Next Year13.7%
Revenue Next 2Y14.78%
Revenue Next 3Y14.32%
Revenue Next 5Y12.55%
EBIT growth 1Y909.47%
EBIT growth 3Y143.94%
EBIT growth 5YN/A
EBIT Next Year82.88%
EBIT Next 3Y45.95%
EBIT Next 5Y33.08%
FCF growth 1Y5019.61%
FCF growth 3Y102.27%
FCF growth 5Y39.14%
OCF growth 1Y3766.18%
OCF growth 3Y85.41%
OCF growth 5Y32.05%