Spotify Stock Dips on New Amazon Threat

Amazon is reportedly launching an ad-supported music-streaming service

by Patrick Martin

Published on Apr 15, 2019 at 10:42 AM

The shares of Spotify Technology SA (NYSE:SPOT) are down 4.2% to trade at $138.91 this morning, under pressure from news of increased competition in the streaming space. More specifically, on late Friday Billboard reported Amazon.com (AMZN) plans to launch a free, ad-supported music-streaming service. Amazon will be able to market its new offering on its Echo devices. 

Prior to today, Spotify stock had added 40% from its Christmas Eve bottom of $103.29. However, the shares ran straight into resistance at their 160-day moving average, and today have breached short-term support at the $140 level. Should today's results hold, it will be SPOT's worst single-day drop since Jan. 3. 

The sentiment among analysts is quite bullish. Of the 20 brokerages covering SPOT, 70% rate it a "buy" or better, with only one "sell" on the books. Plus, the security's consensus 12-month price target of $164.88 sits in territory not charted since early October.

It's a similar mood among short sellers, or lack thereof. Although short interest increased by 8% in the most recent reporting period, the 2.30 million shares sold short represents less than 5% of SPOT's total available float, indicating there's ample room aboard the bearish bandwagon.

The mood is also bullish in the options pits. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), SPOT's 10-day call/put volume ratio of 2.20 indicates long calls have outnumbered puts by a more than 2-to-1 ratio.


a schaeffer's exclusive

5 NEW STOCK PICKS

We're celebrating 38 years with this FREE insider report!


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


What's Next for the American Wealth Gap
Porter Stansberry is predicting a major change in the American economic system.
Weight-Loss Drug Data Lifts Vivus Stock Above 200-Day
One name is eyeing its biggest one-day percentage gain since last August
Analysts Grow Cautious on HPQ and FL Stocks Ahead of Earnings
Calls have remained popular on HPQ, however
IRA/401K Investment Guide: 2019 Stock Market Crash
Use gold to protect any IRA, 401(k), or retirement account from a looming financial crisis.