UPDATE: Stifel Nicolaus Downgrades Pandora Media on Balanced Risk/Reward

In a report published Friday, Stifel analyst Jordan Rohan downgraded the rating on

from Buy to Hold, and removed the $23.00 price target. In the report, Stifel noted, “We have reduced our rating on Pandora from Buy to Hold. Three reasons: 1) The investment story for Pandora has shifted back from a focus on margins, including constraints on hours streamed, to a focus on market share at the expense of margins. 2) Upside in the July quarter came from sub revenues, not ad revenues, and this growth in subscriber revenues is likely to subside. 3) Shares were within 6% of our prior $23 target, not providing sufficient upside to ride through the volatility that comes with intensifying competition in the Internet radio market.” Pandora Media closed on Thursday at $21.71.