Sanctions on Russia Are Affecting These 5 Stocks

3. Spotify Technology S.A. (NYSE:SPOT)

Number of Hedge Fund Holders: 53  

Spotify Technology S.A. (NYSE:SPOT) provides audio streaming services. Top hedge funds remain bullish on the stock. Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Tiger Global Management LLC is a leading shareholder in Spotify Technology S.A. (NYSE:SPOT), with 2.5 shares worth more than $603 million. 

Amid calls for Spotify Technology S.A. (NYSE:SPOT) to suspend operations in Russia completely, the company recently announced that it would be shutting down the Russia office indefinitely and also removing content linked to Russian news platforms like RT and Sputnik. However, the company categorically dismissed calls to suspend services in Russia, noting that it was “critically important to keep services operation for global flow of information”. 

In its Q4 2020 investor letter, Guardian Fund, an asset management firm, highlighted a few stocks and Spotify Technology S.A. (NYSE:SPOT) was one of them. Here is what the fund said:

“At the current share price, Spotify Technology S.A. (NYSE:SPOT) basically only represents a fraction of the value they will be able to unlock in the growing market of audio entertainment. The key for Spotify Technology S.A. (NYSE:SPOT) is to change a variable cost base into a fixed cost base just like Netflix has. As the market share of the big labels, measured by the daily hours of engagement of the big labels, is declining, Spotify Technology S.A. (NYSE:SPOT) will be able to adjust its business model and create enormous operational leverage meaning that profitability will grow faster than expenses.

The music catalogue is not the business model. The value lies in the machine learning that drives discovery and engagement, the original content from people like Michelle Obama, Kim Kardashian, and Joe Rogan, the data analytics and distribution for artists, the direct and social relations artists can have with fans through music and videos. We believe that Spotify will be worth at least five times more in 2030.”