Credit Suisse analyst Brian Russo upgraded Spotify Technology (SPOT) to Neutral from Underperform with an unchanged price target of $120. The stock closed Tuesday down $1.48 to $112.52.

With a "negative narrative" gaining momentum since the summer, expectations for a Q3 subscriber miss are now priced into the stock, Russo tells investors in a research note.

The analyst, who points out Spotify shares are down 28.6% over the past eight weeks and short interest in the name is now at historical highs, sees a balanced risk/reward profile in the near-term. However, Russo's longer-term concerns around Spotify's subscriber and revenue growth remain.