Analyst and options trader sentiment has been bullish on SPOT
Spotify Technology (NYSE:SPOT) is trading 2.1% higher before the open, following a bull note out of Barclays. The brokerage firm began coverage on the music streaming stock with an "overweight" designation and $210 price target, citing the company's growing paying subscriber base and strong user engagement, on top of the fact that Spotify has been free cash flow positive since 2016. On the other hand, the covering analyst said SPOT shares may not be as appealing as fellow streaming name Netflix (NFLX), as some suggested earlier in the year.
Still, Barclays' price target represents a 23.3% premium to the equity's Monday close at $170.37, and sits deep in all-time-high territory. Spotify stock hit a record peak of $182.45 back on June 22, and though it pulled back sharply yesterday amid the broad-market headwinds, it bounced near the 20-day moving average and closed back above the trendline.
The bullish attention is nothing new for the security, which has enjoyed a number of optimistic notes out of the analyst community. Overall, 10 of the 15 analysts tracking SPOT say it's a "strong buy" or "buy," and the average 12-month price target is $183.18.
Options activity has already been upbeat, with long calls almost tripling long puts during the past 10 days across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Peak open interest, meanwhile, resides at the January 2019 230-strike call. In the front-month July series, the 200 call has seen noteworthy attention, along with the August 200 call.