Bank of America announced on Wednesday that it had raised its price target for Spotify from $265 to $315, while reiterating its Buy recommendation on the stock.

In a research note, the research firm hails the restructuring initiated by the online music giant since the beginning of 2023, which has enabled it to drive a favorable trajectory in terms of margins and cash flow.

According to BofA, this inflection point - which has supported the share price over the past 18 months - should continue, thanks to the arrival of new subscribers, price increases, the development of advertising revenues associated with podcasts and the more general improvement in its operating leverage.

In addition, adds the analyst, the company's improved cash flow combined with a solid balance sheet should pave the way, following the forthcoming appointment of a new CFO, for a share buyback program that could act as a catalyst as early as the second half of the year.

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