Speaking to investors on a Q2 earnings call, Vivendi’s CFO, Hervé Philippe, commented: “ have no intention to sell our stake in Spotify, which is a very good partner for us… We are a happy shareholder of Spotify. UMG’s majority-owner, Vivendi, said earlier this month that it had no intention to sell its Spotify stake anytime soon. PayPal boasts a consistent track record of earnings and sales growth, stretching back to at least 2010. companies purchased 710 billion of their own shares of stock. Spotify’s $1 billion buyback program wouldn’t be enough to acquire the entirety of Universal Music Group‘s shareholding in the streaming company, which MBW currently estimates to be worth around $1.45 billion. PayPal Stock Fundamental Analysis: A Strong Track Record. A stock buyback is when a company does just that buys back shares of its own stock. Hervé Philippe, Vivendi (speaking earlier this month) “ have no intention to sell our stake in Spotify, which is a very good partner for us.” The repurchase program does not obligate Spotify to acquire any particular amount of ordinary shares, and the repurchase program may be suspended or discontinued at any time at the company’s discretion. That's a more than acceptable reward-to-risk ratio. In an issue of new stock, a guarantee made by an investor, usually an institution, to a publicly-traded company that it will buy the remainder of an issue.

“We believe this is an attractive use of capital, and based on the strength of our balance sheet, we continue to see ample opportunity to invest and grow our business.”ĭiscussing the new buyback program, Paul Vogel, Chief Financial Officer, Spotify, said: “This announcement demonstrates our confidence in Spotify’s business and the growth opportunities we see over the long term. To compensate for the risk, stocks generate 92 in extra return. Spotify added that the repurchase program would be “executed consistent with the company’s capital allocation strategy, which will continue to prioritize aggressive investments to grow the business”.Īt the close of calendar Q2, according to SEC filings, Spotify was sitting on €2.44 billion (approx $2.85bn) in cash and cash equivalents. Spotify said that the timing and actual number of shares repurchased will depend on a variety of factors, including “price, general business and market conditions, and alternative investment opportunities”. Today’s buyback news has certainly rallied some shareholder confidence in SPOT: its share price is up by over 6% on the New York Stock Exchange at the time of publication.

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