UBS Sets Bullish $720 Target for Spotify Despite Weak Q2 Guidance

Key Facts

1A UBS analyst set a price target of $720 for Spotify, suggesting a potential 65.92% upside.

2Spotify shares plunged by up to 14% after projecting Q2 operating income of €630 million, missing analyst estimates.

3The company projects premium subscribers to reach 299 million, falling short of Wall Street expectations of 300.40 million.

UBS analysts have issued a highly bullish price target of $720 for Spotify (SPOT), implying a significant potential upside of 65.92%. This optimistic outlook comes despite a sharp 14% drop in the company's share price following disappointing Q2 guidance. Spotify projected an operating income of €630 million for the second quarter, missing consensus estimates and sparking market concerns. Furthermore, the company expects premium subscribers to reach 299 million, falling short of the 300.40 million anticipated by Wall Street. Despite these headwinds, UBS remains confident in the streaming giant's long-term trajectory, looking past the immediate impact of recent price hikes. The market reaction highlights a disconnect between short-term guidance misses and the aggressive valuation targets set by major financial institutions.