Should You Invest in Spotify Technology S.A. (SPOT)?

Rowan Street Capital, an investment management company, released its August update recently. A copy of the same can be downloaded here. Since the end of the second quarter, the fund has been 30% up. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.

Rowan Street Capital discussed stocks like Spotify Technology S.A. (NYSE:SPOT) in the August update letter. Headquartered in Luxembourg, Luxembourg, Spotify Technology S.A. (NYSE:SPOT) provides audio streaming services. On October 10, 2022, Spotify Technology S.A. (NYSE:SPOT) stock closed at $85.97 per share. One-month return of Spotify Technology S.A. (NYSE:SPOT) was -15.68% and its shares lost 63.46% of their value over the last 52 weeks. Spotify Technology S.A. (NYSE:SPOT) has a market capitalization of $16.563 billion.

Here is what Rowan Street Capital specifically said about Spotify Technology S.A. (NYSE:SPOT) in its August month investor letter:

Spotify Technology S.A. (NYSE:SPOT) reported a really strong Q2. They have re-accelerated growth in monthly active users (MAU) and are expected to reach 450 million users in Q3, which is impressive because, at their scale, it’s very difficult to re-accelerate MAUs (not many platforms in the world can do that).

Ad-supported users grew 22%, while ad-supported revenues grew 31%; overall revenue grew 23%. Spotify generated 9th straight quarter of positive free cash flow, averaging $250 million in trailing 12 months free cash, while continuing to heavily reinvest into the growth of their platform. Stock is currently trading at only 2x 2022 revenues and 8x gross margins.”

Spotify

Photo by Alexander Shatov on Unsplash

Spotify Technology S.A. (NYSE:SPOT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 49 hedge fund portfolios held Spotify Technology S.A. (NYSE:SPOT)  at the end of the second quarter which was 49 in the previous quarter.

We discussed Spotify Technology S.A. (NYSE:SPOT) in another article and shared Baron Funds’ views on the company. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.