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UBS upgraded Spotify stock to "buy"
UBS upgraded shares of music streaming platform Spotify Technology SA (NYSE:SPOT) to "buy" from "neutral" and hiked its price target from $170 to $274 -- a more than 25% premium to last night's close of $218.61.
According to the brokerage's bull note, "[E]fficiency initiatives remain the focus and have increased conviction on sustainable margin expansion and stronger bottom line trends in the coming year." In response to the upgrade, Spotify stock is trading 1.6% higher before the bell, looking to open above the $220 level for the first time since January 2022.
Since bouncing above the $200 level -- an area of resistance in December -- the equity pulled back slightly on Jan. 17, but is now holding seven wins in the last eight sessions. What's more, SPOT is up 113.8% over the last 12 months, and already boasts a 16.3% year-to-date lead.
Despite this robust performance, some analysts are still on the fence. While 16 covering brokerages rate Spotify stock a "buy" or better, 10 still recommend a tepid "hold." Meanwhile, the 12-month average target price of $217.45 is a 2.1% discount to last night's close. This leaves plenty of room for additional upgrades and/or price-target hikes to roll in.