Spotify Technology is the IBD Stock Of The Day as the streaming music leader holds up amid the Trump tariff turmoil and economic uncertainty.
Shares of the audio entertainment giant have formed a double-bottom base with a buy point of 621.20, according to IBD MarketSurge charts.
However, Spotify stock is trading below its 50-day moving average line, a negative sign. It's also in a sixth-stage base, and breakouts from late-stage bases are more prone to fail.
On the stock market today, Spotify stock rose 1% to close at 549.17.
In a show of strength, the relative strength line of Spotify stock is near its highs as it outperforms the overall market. Spotify stock has a strong Relative Strength Rating of 97 out of 99, according to IBD Stock Checkup.
Spotify Earnings
The next potential catalyst for Spotify stock is the first-quarter earnings report, due early on April 29. Analysts polled by FactSet expect Spotify to earn $2.49 a share, up 139% year over year. Revenue is seen rising 23% to $4.77 billion in the March quarter.
Further, analysts predict that Spotify will add 1.9 million premium subscribers in Q1 for a total of 264.9 million worldwide. They also see the service reaching 679 million monthly active users in the period, up 4 million since the end of 2024. Spotify offers an ad-supported service in addition to its commercial-free subscription service.
On Monday, TD Cowen analyst Doug Creutz reiterated his hold rating on Spotify stock with a price target of 457.
"We generally view the music industry as being attractively defensive given the currently overly dynamic political/economic situation," he said in a client note. "Digital goods are unaffected by tariffs."
But Creutz favors music content ownership stocks like Warner Music Group, Sony and European-traded Universal Music Group over music aggregators like Spotify.
Spotify Stock On Two IBD Lists
Others are more positive on Spotify stock. Evercore ISI analyst Mark Mahaney rates Spotify as outperform with a price target of 700.
"We view the Spotify value proposition as highly defensive in the event of a material economic downturn," he said in a client note Sunday. Mahaney expects Spotify to deliver a "modest beat-and-bracket" Q1 report.
On a cautionary note, he thinks Street estimates for Spotify's monthly active user growth in the second quarter are too aggressive.
In addition to gaining share in the streaming music market, Spotify has other levers to drive sales and earnings. It recently announced new initiatives to boost its advertising revenue. The company also is rumored to be considering a higher-priced service level for "super fans."
Spotify stock is on two IBD lists: Leaderboard and Tech Leaders.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
