BofA reiterates a Buy rating on Spotify with a 39.8% upside target, citing long-term revenue and margin growth potential.
Bank of America maintained a Buy rating on Spotify Technology (SPOT) and set a $685 price target, representing 39.8% upside from the current $489.93 share price. The firm highlighted the company’s shift toward leveraging its large user base for higher revenue and margins rather than focusing solely on subscriber growth.
Spotify’s investor day outlined long-term goals, including mid-teens constant-currency revenue growth, 35% to 40% gross margins, and operating margins above 20% by 2030. Management also projected ambitions of reaching 1 billion subscribers and a €100 billion revenue opportunity.
The note emphasized Spotify’s strategy to monetize engaged users through pricing segmentation and premium experiences, signaling a broader platform expansion beyond music streaming.