Spotify Technology (SPOT 1.70%) is one of the top 10 holdings in famed investor Cathie Wood's popular ARK Innovation ETF (ARKK 0.13%). But does the audio streaming platform belong in such a lofty spot in the ARK Invest founder and CEO's largest exchange-traded fund (ETF)? In this episode of "The Morning Show" on Motley Fool Liverecorded on Dec. 21, Fool analysts Maria Gallagher and Jim Gillies discuss where Spotify succeeds and where it struggles.

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Maria Gallagher: Spotify is one of those companies that I love as a consumer. I love the founder, I love the story. I think it's one of those companies that if you snapped your fingers and it was gone in five years, I would really notice because I listen to Spotify every single day. But the unit economics and the variable costs working with the record labels just without severely increasing prices, which Daniel Ek doesn't want to do. The question of can it ever be profitable in a meaningful way? One that I, when you look at the numbers, have never been able to calculate it where the answer is yes without severely increasing prices or changing the way because they're pretty tight-lipped about how they work with the record labels. They have been doing it for a long time, but because it's variable cost obviously, the artists don't get paid that much unless you're Drake and Taylor Swift. The record labels don't give Spotify the best deals. Spotify has to pay the record labels, the record labels are terrible to the artist anyway. Spotify's biggest lever is their price increases, which they don't use. I'm just surprised because I think it's a great company. I don't necessarily think it's a great cash-generating machine at any point, unless Daniel Ek decides to jack up prices or go into a different, more profitable venture within Spotify.

Jim Gillies: I wonder, Maria, if it might be because I was very carefully listening to the words you were using at the beginning and you used the word "love" three times, maybe four.

Gallagher: Yeah.

Gillies: I'm not an investor like David Gardner, but I really like David Gardner's style. I don't need to listen to other value guys, I got that angle figured out. David Gardner teaches me something practically every time I listen to him. David Gardner, of course, likes to talk about love your stocks. We've got some other Fools who talk about loving their stocks. Just to hear you talk about how passionate you are about this company, I've never looked at Spotify, I want to go look at this company. It provokes that reaction in someone whose opinion and work I respect. But you've also basically given me the spoiler, which is I can't make the numbers work, but I wonder if Cathie's team, the ARK team, is looking at the first things you talked about, about loving the CEO, loving the company, loving the service, the snap test, you'd miss it. I wonder if they're focused on that, what I'm going to call the more David Gardner intangibles, which he's really good at identifying, and basically saying, "If I've got to that, this other stuff will come."