Spotify: The Good, Bad And Ugly

Summary

  • Spotify share prices remain at a depressed level as compared with the metrics of major competitors.
  • Growth continues at a rapid pace, and the success story of Spotify is contingent on this continuing.
  • First-mover advantage in podcasts is seen as a risky move that has potential to materially increase the value of Spotify’s core offering.

Investment Thesis

Spotify clearly has a first-mover advantage in the realms of music streaming, but with increasing competition from technology giants that possess both competency and war chests measured in the tens of billions, Spotify remains a high-risk high-reward play.

 

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