Spotify Stock (SPOT) Slips Beneath $500 Despite Citi Buy Rating

Spotify stock (NYSE: SPOT) has slipped beneath $500 per share and, in turn, its value as of January 2025. Photo Credit: Digital Music News

Despite receiving buy ratings from Citigroup and Goldman Sachs, Spotify stock (NYSE: SPOT) has tanked beneath $500 per share. And while multiple analysts believe SPOT is poised to climb, one firm has now settled on a $487 target.

At the time of writing, SPOT was hovering around $465 – for a roughly 8% slip from the start of trading, a close to 19% falloff from 2026’s beginning, and an approximately 15% decrease from early February 2025.

Noteworthy on their own, the sizable dips are particularly interesting in light of the mentioned buy ratings and bullish target prices. Whatever the reason(s) for Spotify stock’s present woes, the valuation plummet definitely isn’t attributable to a lack of analyst enthusiasm.

To be sure, one professional wrapped 2025 by forecasting an ascent to $900 for SPOT. Others were more measured when assessing the stock in the new year – though even they opted for optimistic targets ranging from $615 (Cantor Fitzgerald) to $800 (UBS). Morgan Stanley, for its part, arrived at a buy rating and a $775 SPOT target yesterday.

Naturally, all these points tie back to a simple-but-significant question: What’s causing the ongoing drop and, in turn, the widening gap between SPOT’s positioning and analysts’ targets?

At the top level, the market’s downward pressure and volatility are worth keeping in mind here; broader factors are certainly in play. (At least in theory, however, analysts should be accounting for said factors when predicting Spotify stock’s path forward.)

Then there’s the fact that Apple Music and Amazon Music are staying put on pricing as Spotify plows ahead with price increases. In general, analysts (and the major labels) have applauded the bumps.

But what happens if they cause subscribers to jump ship? And assuming paid accounts hold steady in the near term, how much long-term pricing room does Spotify really have given competitors’ commitment to smaller monthly charges?

Moffett Nathanson’s Clay Griffin, who concluded January with the initially highlighted $487 SPOT target, explored the points in clear-cut terms. In his view, on-demand streaming is largely saturated in established markets, and the subscriber-growth phase is “drawing to a close.”

Needless to say, the picture isn’t very encouraging for Spotify. On the other hand, the analyst also expressed the belief that “there’s plenty of room for pricing growth” – though this perceived room wouldn’t necessarily make up for a full-scale subscription-base contraction in established markets.

(Especially in the inherently brass-tacks financial world, overviews of complex topics are just that. But by the numbers, plenty of adults in established markets have yet to pay for on-demand music access; whether they, having resisted subscribing even when plans cost less, can be convinced to do so remains to be seen. Also unanswered are revenue questions about Spotify’s superfan tier, little-discussed AI features, and advertising overhaul.)

Finally, long-term growth prospects, market factors, and leadership-change uncertainty aside, it seems safe to say that Spotify’s upcoming Q4 2025 results will prove decidedly important on the share-price front.

Having taken the co-CEO reins to kick off 2026, Alex Norström and Gustav Söderström are set to discuss those results during a call one week from today.