Spotify downgraded to Sell from Neutral at Redburn Atlantic

Redburn Atlantic analyst Agnieszka Pustula downgraded Spotify to Sell from Neutral with a $230 price target. The analyst worries that positive momentum “has carried the stock, and the forecast expectations, too far.” Spotify’s current market valuation implies 21% compound annual EBIT growth between 2026 and 2030, which overestimates the scope for pricing-driven growth and/or the subscriber opportunity in developed markets, the analyst tells investors in a research note. Redburn says this implied growth rate is twice as high as its estimates, even though it “optimistically” assumes annual price increases to Premium plans, gross margins expanding above 32% and operating costs falling to 20% of sales by 2028.