It turns out all Spotify stock (NYSE: SPOT) needed to rebound was a positive assessment from Arete Research: Shares spiked by 7% today, to almost $500 a pop, after the firm upgraded to buy and settled on a $586 target. Meanwhile, Reservoir Media (NASDAQ: RSVR) stock jumped by closer to 20% amid a reported activist investor takeover attempt.
Word of Arete’s (relatively) bullish forecast surfaced this morning, and Spotify shares finished the day at about $496 apiece. Despite representing a 7% improvement from opening, once again, the price is still down 13.8% on the year and closer to 29% during the past six months.
Stated differently, while the single-day resurgence is significant, SPOT has a ways to go before returning to its roughly $800 June 2025 peak. Furthermore, it wasn’t very long ago that curiously enthusiastic analysts were predicting an ascent to around $1,000 per share.
Of course, those who invested when wild forecasts were the norm and SPOT was riding high will have a different view of today’s boost than those who got in, say, last week.
This ties back to the “relatively” bullish nature of Arete’s outlook: Technically, the “totally independent” and institutional-investor-geared firm, although anticipating a major upside for SPOT, sliced its target from $680.
(Across the past couple weeks alone, that’s also been the case – reduced targets implying material SPOT growth – for multiple other analysts.)
In any event, the measured optimism, including an upgrade from neutral to buy, was evidently enough to drive a bit of market confidence. The firm’s full Spotify stock report hasn’t been publicly released, but financial trades have indicated that Arete is banking on better-than-expected Premium margin growth and a limited AI-disruption risk for Spotify.
If anything, far from missing the AI train, Spotify is being perhaps too aggressive in pushing the technology; execs were rather thorough when describing their AI ambitions and current capabilities during the company’s recent earnings call.
Separately, Spotify isn’t the only music business that enjoyed a share-price increase today.
Possibly because of different elements of Arete’s report – Suno-partnered Warner Music Group (WMG) is quite optimistic about its own AI-revenue prospects – WMG shares rose 4% to finish at almost $28 each.
But that growth percentage pales in comparison to the 17.9% hike turned in by Reservoir, which reportedly received an unsolicited takeover bid from Irenic Capital Management.
We’ve been covering Irenic since it first took a stake in Reservoir. And as we noted nine days ago, the activist investor kicked off 2026 by reiterating its massive RSVR position and its belief that the shares “are undervalued and represent an attractive investment opportunity.”
