Contrasting Spotify Technology (NYSE:SPOT) and Manchester United (NYSE:MANU)
by Sarita Garza · The Markets DailySpotify Technology (NYSE:SPOT – Get Free Report) and Manchester United (NYSE:MANU – Get Free Report) are both communication services companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.
Insider & Institutional Ownership
84.1% of Spotify Technology shares are held by institutional investors. Comparatively, 23.3% of Manchester United shares are held by institutional investors. 0.4% of Spotify Technology shares are held by insiders. Comparatively, 68.6% of Manchester United shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Spotify Technology has a beta of 1.61, suggesting that its stock price is 61% more volatile than the S&P 500. Comparatively, Manchester United has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Spotify Technology and Manchester United, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Spotify Technology | 1 | 9 | 23 | 1 | 2.71 |
| Manchester United | 1 | 0 | 0 | 0 | 1.00 |
Spotify Technology presently has a consensus target price of $620.07, suggesting a potential upside of 4.18%. Given Spotify Technology’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Spotify Technology is more favorable than Manchester United.
Profitability
This table compares Spotify Technology and Manchester United’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Spotify Technology | 15.74% | 35.64% | 21.23% |
| Manchester United | -6.36% | -12.22% | -1.32% |
Earnings & Valuation
This table compares Spotify Technology and Manchester United”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Spotify Technology | $18.81 billion | 6.51 | $2.50 billion | $15.08 | 39.47 |
| Manchester United | $909.43 million | 3.99 | -$57.64 million | ($0.33) | -63.73 |
Spotify Technology has higher revenue and earnings than Manchester United. Manchester United is trading at a lower price-to-earnings ratio than Spotify Technology, indicating that it is currently the more affordable of the two stocks.
Summary
Spotify Technology beats Manchester United on 14 of the 15 factors compared between the two stocks.
About Spotify Technology
Spotify Technology S.A., together with its subsidiaries, provides audio streaming subscription services worldwide. It operates through two segments, Premium and Ad-Supported. The Premium segment offers unlimited online and offline streaming access to its catalog of music and podcasts without commercial breaks to its subscribers. This segment sells directly to the end users. The Ad-Supported segment provides on-demand online access to its catalog of music and unlimited online access to the catalog of podcasts to its users on their computers, tablets, and compatible mobile devices. The company also offers sales, distribution and marketing, contract research and development, and customer and other support services. Spotify Technology S.A. was incorporated in 2006 and is based in Luxembourg City, Luxembourg.
About Manchester United
Manchester United plc, together with its subsidiaries, owns and operates a professional sports team in the United Kingdom. It operates Manchester United Football Club, a professional football club. The company develops marketing and sponsorship relationships with international and regional companies to leverage its brand. It also markets and sells sports apparel, training and leisure wear, and other clothing; and other licensed products, such as coffee mugs and bed spreads featuring the Manchester United brand and trademarks, as well as distributes these products through Manchester United branded retail centers and e-commerce platforms, and through the company’s partners’ wholesale distribution channels. In addition, the company distributes live football content directly, as well as through commercial partners; broadcasts television rights relating to the Premier League, Union of European Football Associations club competitions, and other competitions; and delivers Manchester United programming through MUTV television channel to territories worldwide. Further, it operates Old Trafford, a sports venue with 74,240 seats, as well as invests in properties. The company was formerly known as Manchester United Ltd. changed its name to Manchester United plc in August 2012. Manchester United plc was founded in 1878 and is headquartered in Manchester, the United Kingdom.