Spotify's Tuesday IPO Share Price Being Given Wide Analyst Berth at $160-$225

Speculation on Spotify's opening share price was all over the board Monday, before the company's initial public offering takes effect Tuesday, we found. CNNMoney called the Spotify IPO “eagerly anticipated” and “bizarre,” saying, “Nobody knows what the price will be when the stock starts trading.” Business Insider said Spotify is going public at “the worst possible time for tech stocks,” after Facebook’s data collection debacle slammed it and other tech stocks at the end of March, a slide that continued Monday. Shares of Amazon (down 5.2 percent to $1371.99), Apple (down 1.1 percent to $166.68), Facebook (down 2.8 percent to $155.39) and Google (down 2.4 percent to $1,102.63) fell Monday. Brokers have already published Spotify price targets in the range of $160-$225 per share, said reports. Analyst Gary Alexander, in a Seeking Alpha column, wrote that the implied market value of $37 billion-$41 billion is “far higher” than Spotify’s last reported valuation of $19 billion. “Without underwriters to stabilize the offering, Spotify's IPO is likely to be much more volatile than the typical IPO -- either up or down,” he said. Spotify’s direct listing on the New York Stock Exchange Tuesday could pave the way for other pre-IPO companies to choose a similar alternate route to going public, but the deal carries a “high degree of uncertainty” since 91 percent of the 178 million shares will be set by broker-dealers based on buy and sell orders, said Renaissance Capital IPO Research last week (see 1803300007).