Spotify (SPOT) ended the recent trading session at $373.98, demonstrating a +0.97% swing from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 0.71%. Meanwhile, the Dow gained 1.03%, and the Nasdaq, a tech-heavy index, added 0.6%.

The the stock of music-streaming service operator has risen by 13.27% in the past month, leading the Business Services sector's gain of 5.54% and the S&P 500's gain of 6.41%.

The upcoming earnings release of Spotify will be of great interest to investors. The company is forecasted to report an EPS of $1.79, showcasing a 397.22% upward movement from the corresponding quarter of the prior year. Simultaneously, our latest consensus estimate expects the revenue to be $4.38 billion, showing a 19.83% escalation compared to the year-ago quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.24 per share and a revenue of $17.1 billion, representing changes of +311.53% and +19.36%, respectively, from the prior year.

Investors should also take note of any recent adjustments to analyst estimates for Spotify. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.2% lower. Spotify is holding a Zacks Rank of #4 (Sell) right now.

In terms of valuation, Spotify is currently trading at a Forward P/E ratio of 59.39. This signifies a premium in comparison to the average Forward P/E of 24.25 for its industry.

The Technology Services industry is part of the Business Services sector. With its current Zacks Industry Rank of 82, this industry ranks in the top 33% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.