We assign a fundamental rating of 6 out of 10 to SPOT. SPOT was compared to 80 industry peers in the Entertainment industry. SPOT has an excellent financial health rating, but there are some minor concerns on its profitability. SPOT has a correct valuation and a medium growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year SPOT was profitable.
SPOT had a positive operating cash flow in the past year.
SPOT had negative earnings in 4 of the past 5 years.
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.
SPOT has a Return On Equity of 18.06%. This is amongst the best in the industry. SPOT outperforms 87.50% of its industry peers.
SPOT's Return On Invested Capital of 19.82% is amongst the best of the industry. SPOT outperforms 96.25% of its industry peers.

		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 Operating Margin of 11.68%. This is in the better half of the industry: SPOT outperforms 73.75% of its industry peers.
In the last couple of years the Operating Margin of SPOT has grown nicely.
With a Gross Margin value of 31.75%, SPOT is not doing good in the industry: 65.00% of the companies in the same industry are doing better.
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.
Compared to 1 year ago, SPOT has more shares outstanding
The number of shares outstanding for SPOT has been increased compared to 5 years ago.
The debt/assets ratio for SPOT has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 9.57 indicates that SPOT is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 9.57, SPOT belongs to the top of the industry, outperforming 96.25% of the companies in the same industry.
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.
SPOT has a better Debt to Equity ratio (0.06) than 65.00% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.06
Debt/FCF	0.75
Altman-Z	9.57

ROIC/WACC2.6

WACC7.63%

2.3 Liquidity

A Current Ratio of 1.61 indicates that SPOT should not have too much problems paying its short term obligations.
SPOT has a better Current ratio (1.61) than 70.00% of its industry peers.
A Quick Ratio of 1.61 indicates that SPOT should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.61, SPOT is doing good in 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.
Measured over the past years, SPOT shows a quite strong growth in Revenue. The Revenue has been growing by 18.30% on average per year.

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

Based on estimates for the next years, SPOT will show a very strong growth in Earnings Per Share. The EPS will grow by 29.34% on average per year.
Based on estimates for the next years, SPOT will show a quite strong growth in Revenue. The Revenue will grow by 12.46% on average per year.

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

A Price/Earnings ratio of 73.80 indicates a quite expensive valuation of SPOT.
67.50% of the companies in the same industry are more expensive than SPOT, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.32, SPOT is valued quite expensively.
With a Price/Forward Earnings ratio of 33.60, SPOT can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, SPOT is valued a bit cheaper than 70.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.57, SPOT is valued a bit more expensive.

		Industry Rank	Sector Rank
PE	73.8
Fwd PE	33.6

4.2 Price Multiples

SPOT's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SPOT indicates a somewhat cheap valuation: SPOT is cheaper than 75.00% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	29.65
EV/EBITDA	36.5

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
SPOT has a very decent profitability rating, which 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.