Monday Show Note

I was asked by a colleague over the weekend as to what my thoughts were for future value regarding Spotify™ and others going forward.

Here I’ll paraphrase the set up of the question…

So what do you think the value of these entities going forward are going to be worth? Surely they have value because they do have subscribers that will continue paying for the service in some manner or form, no?

My answer…

Well, yes and no. In other words, there will always be a place where top talent, of any field, has a value proposition to hold subscribers. However, that does not mean it will, or may reflect anything, or have any value, that Wall Street had applied in the past, or may apply in the future.

There is precedent if you want an idea. e.g., Think Spotify™ as yesterday’s Sirius-XM™ and all that entailed with the hoopla and the acquisition of Howard Stern.

They paid, and still do, $millions upon $millions for Howard now going on two decades. But what has Wall Street affixed for a value proposition? Hint: it’s minus 10X of what it was from its once heralded 10X positive prior. Meaning…It’s been “dead money” for almost as long as Howard has been there. Think of that very carefully, for you may be looking at history rhyming with the whole Rogan/Spotify timing.

Here’s a chart of Sirius XM™ via monthly increments going back to 1995. See if you can spot the pattern possibly developing in Spotify. To wit:

(Chart Source)

And here’s Spotify as of the moment via the same monthly increments for comparing, again, to wit:

(Chart Source)

Gives Mr. Twain’s attributed maxim “History doesn’t repeat, but it sure does rhyme.” far more “cowbell” than many give it credit for, yes?

© 2022 Mark St.Cyr

Note: This is not trading or investing advice of any sort. This commentary is for “big picture” discussion purposes only. Please read, or re-read the “About This Site” page for any questions or clarifications.