You are here: Home » Reuters » News
Business Standard

New kid on NYSE block: Spotify shares attract all ages not just millennials

Spotify's listing was hotly followed, as it went public via the unusual method of a direct listing, without selling new shares

Reuters 

Headphones are seen in front of a logo of online music streaming service Spotify
Headphones are seen in front of a logo of online music streaming service Spotify

The buzzy debut of SA on Stock Exchange on Tuesday drew across generations, not just the Millennials who make up the largest proportion of the music streaming service's customer base, said on Wednesday.

Spotify's listing was hotly followed, as it went public via the unusual method of a direct listing, without selling new shares. There was demand for the stock, and shares ended up 12.9 percent on their first day of trade on Stock Exchange. On Wednesday, the shares ended the day's session at $145.87, down 2.1 percent from Tuesday's close.

Snap Inc's high-profile IPO last year had been notable for being popular with Millennials, the primary user base for the company's mobile app Snapchat. But though Millennials are also a key demographic for Spotify, the Swedish company's listing did not draw disproportionate interest from that generation.

Demand was seen across age groups, according to brokerages and

"There's good interest in it," said J.J. Kinahan, TD Ameritrade's chief market strategist, who is based in "It's pretty well split across age groups."

said among its customers, baby boomers were slightly more active in trading shares than Millennials or members of Generation X. Baby boomers made nearly one-third more trades than Millennials and 20 percent more trades than members of Generation X. A similar pattern holds for other tech IPOs, a spokesman said.

indicated some caution about jumping in.

On StockTwits, a whose users are mostly retail investors, only 40 percent of members were bullish on ahead of the debut. Negative sentiment toward the IPO rose as the date approached and the expected trading price climbed, said Hoffman,

"Our community is as bearish as they've ever been (about Spotify)," Hoffman said.

On the site, users posted messages expressing concerns about Spotify's lack of profits and competition from companies such as Apple Inc.

High-profile IPOs of companies associated with the tech sector have had a mixed track record in the past year. Shares of and Roku Inc, which went public in March 2017 and September 2017, respectively, have climbed more than 100 percent since those companies' IPOs. On the other hand, shares of Snap and have fallen below their IPO prices.

Individual investors who spoke with similarly expressed reservations about buying shares.

"I think a lot of similarly situated still view many of the VC-backed, marketplace tech companies as destined IPO flops," said Layla Tabatabaie, an to tech startups who lives in

Others said they would only consider buying the stock at a lower price.

"It's certainly a strong company in regards to the service it offers," said Jonathan Johnson, a in Portland, "I'd consider buying it but not at these (price) levels."

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Thu, April 05 2018. 23:46 IST
RECOMMENDED FOR YOU