Spotify poised to emulate Netflix as next top streaming stock, charts show
Spotify (SPOT) has emerged as a dominant force in the streaming music industry, surpassing competitors like Apple Music, Amazon, and Sirius XM. Currently trading just below its all-time highs, Spotify’s stock is showing signs of potential growth, with expectations of reaching new peaks following strong third-quarter earnings on November 12.
With a strategic approach, Todd Gordon, Founder of Inside Edge Capital, LLC, has included SPOT in his portfolios, anticipating a bullish trend for the stock. Analyzing the stock’s performance, Gordon notes that Spotify’s earnings trajectory has been remarkable, with a significant turnaround from losses in 2023 to substantial profits in subsequent years. Projections for 2025 suggest continued growth, highlighting the company’s ability to generate increased free cash flow.
Examining the technical charts, Gordon points out key indicators that signal a positive outlook for Spotify. The stock is currently in a consolidation phase near its all-time highs, with the potential to break through to new levels. The weekly chart indicates a neutral position, while the daily chart shows a promising bull-flag pattern forming, awaiting a surge in accumulation volume to drive it towards new highs.
Comparing Spotify to Netflix, Gordon draws parallels between the two companies operating in the communication and entertainment sectors. Netflix’s recent success in surpassing expectations and reaching new highs through the introduction of new subscription tiers serves as a positive indicator for Spotify’s potential growth. Additionally, Spotify’s focus on leveraging artificial intelligence for content recommendations aligns with industry trends seen in companies like Meta.
Overall, the outlook for Spotify remains optimistic, with the company’s strategic initiatives and strong earnings potential positioning it for continued success in the competitive streaming music market. Investors and analysts alike are closely monitoring Spotify’s performance, anticipating further growth and market leadership in the coming years.
