Overall SPOT gets a fundamental rating of 6 out of 10. We evaluated SPOT against 80 industry peers in the Entertainment industry. SPOT has an excellent financial health rating, but there are some minor concerns on its profitability. SPOT is not valued too expensively and it also shows a decent growth rate.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

SPOT had positive earnings in the past year.
In the past year SPOT had a positive cash flow from operations.
In the past 5 years SPOT reported 4 times negative net income.
Each year in the past 5 years SPOT had a positive operating cash flow.

1.2 Ratios

With an excellent Return On Assets value of 9.56%, SPOT belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
The Return On Equity of SPOT (18.06%) is better than 87.50% of its industry peers.
Looking at the Return On Invested Capital, with a value of 19.82%, SPOT belongs to the top of the industry, outperforming 96.25% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	9.56%
ROE	18.06%
ROIC	19.82%

ROA(3y)-0.84%

ROA(5y)-2.44%

ROE(3y)-6.13%

ROE(5y)-8.14%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

Looking at the Profit Margin, with a value of 8.32%, SPOT belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
SPOT has a better Operating Margin (11.68%) than 73.75% of its industry peers.
In the last couple of years the Operating Margin of SPOT has grown nicely.
Looking at the Gross Margin, with a value of 31.75%, SPOT is doing worse than 65.00% of the companies in the same industry.
In the last couple of years the Gross Margin of SPOT has grown nicely.

		Industry Rank	Sector Rank
OM	11.68%
PM (TTM)	8.32%
GM	31.75%

OM growth 3Y107.65%

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y4.12%

GM growth 5Y3.51%

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ROA

ROE

ROIC

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so SPOT is creating value.
SPOT has more shares outstanding than it did 1 year ago.
SPOT has more shares outstanding than it did 5 years ago.
SPOT has a better debt/assets ratio than last year.

2.2 Solvency

An Altman-Z score of 9.59 indicates that SPOT is not in any danger for bankruptcy at the moment.
SPOT has a Altman-Z score of 9.59. This is amongst the best in the industry. SPOT outperforms 97.50% of its industry peers.
SPOT has a debt to FCF ratio of 0.75. This is a very positive value and a sign of high solvency as it would only need 0.75 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.75, SPOT belongs to the best of the industry, outperforming 86.25% of the companies in the same industry.
A Debt/Equity ratio of 0.06 indicates that SPOT is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.06, SPOT is doing good in the industry, outperforming 65.00% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.06
Debt/FCF	0.75
Altman-Z	9.59

ROIC/WACC2.6

WACC7.63%

2.3 Liquidity

SPOT has a Current Ratio of 1.61. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
SPOT has a better Current ratio (1.61) than 70.00% of its industry peers.
SPOT has a Quick Ratio of 1.61. This is a normal value and indicates that SPOT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.61, SPOT is in the better half of the industry, outperforming 71.25% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.61
Quick Ratio	1.61

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 38.11% over the past year.
Looking at the last year, SPOT shows a quite strong growth in Revenue. The Revenue has grown by 11.89% in the last year.
The Revenue has been growing by 18.30% on average over the past years. This is quite good.

EPS 1Y (TTM)38.11%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%126.21%

Revenue 1Y (TTM)11.89%

Revenue growth 3Y17.47%

Revenue growth 5Y18.3%

Sales Q2Q%7.12%

3.2 Future

The Earnings Per Share is expected to grow by 29.34% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 12.46% on average over the next years. This is quite good.

EPS Next Y34.11%

EPS Next 2Y50.58%

EPS Next 3Y42.21%

EPS Next 5Y29.34%

Revenue Next Year9.53%

Revenue Next 2Y11.7%

Revenue Next 3Y12.45%

Revenue Next 5Y12.46%

3.3 Evolution

The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 73.47, which means the current valuation is very expensive for SPOT.
Based on the Price/Earnings ratio, SPOT is valued a bit cheaper than 67.50% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.30. SPOT is valued rather expensively when compared to this.
With a Price/Forward Earnings ratio of 33.46, SPOT can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SPOT indicates a somewhat cheap valuation: SPOT is cheaper than 70.00% of the companies listed in the same industry.
SPOT is valuated rather expensively when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	73.47
Fwd PE	33.46

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as SPOT.
SPOT's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. SPOT is cheaper than 75.00% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	29.53
EV/EBITDA	36.62

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of SPOT may justify a higher PE ratio.
SPOT's earnings are expected to grow with 42.21% in the coming years. This may justify a more expensive valuation.