Spotify Technology S.A. (NYSE:SPOT) is one of the stocks Jim Cramer recently answered questions about. When a caller mentioned that the stock has been down recently, Cramer said:
“Yeah, that made no sense to me. I looked at Spotify, too. I don’t understand why it’s not coming back. It’s a great subscription business, and I think you ought to buy the stock.”
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Spotify Technology S.A. (NYSE:SPOT) provides audio streaming services. It lets users listen to music and podcasts either through ad-free subscriptions or free, ad-supported access. Cramer mentioned the company during the August 5 episode and commented:
“We know that the latest results missed the mark, and the guidance for the current quarter didn’t have much going for it. But is that enough reason to give up on a stock like Spotify that’s been a serial outperformer for years?… This is the best streaming audio platform around… They’ve acknowledged the shortcomings and laid out a plan to fix it. And look, despite the weakness in ad revenue, Spotify grew monthly active advertisers by 40% year over year. They also know that most of the heavy lifting on their ad tech stack is now complete…
Going forward, Spotify plans to focus on driving adoption, launching new advertising tools, and improving performance. They even said they’re seeing early signs of progress in their programmatic ad sales business. Pretty good, huh? One more positive, Spotify recently increased its buyback authorization from $1 billion to $2 billion, leaving about $1.9 billion still available. The company hasn’t bought back stock since 2022, but this expanded repurchase authorization signals that I think they might be getting ready to buy their own shares, right along with you.
… I never take competition with Apple or Amazon lightly, but Spotify’s still the clear market leader for a reason. For now, nobody else comes close… Even though Spotify’s latest quarter did indeed come up short, no one’s denying that, I think the total breakdown in the stock has created a tremendous buying opportunity, and this is a genuinely great franchise.”
While we acknowledge the risk and potential of SPOT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SPOT and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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