Market Overview

Critical Barron's Article Weighs In On Pandora's Recent Stock Movements

Critical Barron's Article Weighs In On Pandora's Recent Stock Movements
Related P
Watch These 7 Huge Call Purchases In Tuesday Trade
Pandora Vs. Spotify Vs. Apple Music Vs. Soundcloud: Which Is Better For The Artist?

Barron's called Pandora Media Inc (NYSE: P)'s Monday surge and the current pricing unjustified, pointing out the weak advertising revenue in the most recent quarter.

"[W]ith Pandora trading for 95 times forward earnings. That's slightly less than the 111 times it fetched when Barron's warned the shares could fall at the start of the year, but still too expensive, given that analysts expect sales growth to slow form 20 percent year over year in 2015 to 18.7 percent next year," the report read. On top of that, management provided downbeat forecast.

Recent Moves

Monday's surge followed a SunTrust upgrade to Buy and a tripled target price to $18 from $6.

Barron's pointed out that the company lost about $170 million last year. Furthermore, the company is expected to lose over $200 million in the current year. In January, the publication "panned" the company, saying it sees the stock underperforming the broader index. Although the stock advanced 6.6 percent, it was lower than the 10.5 percent gain recorded by S&P 500 since its article in January.

Related Link: Music Streaming Competition Intensifies With Revamped Offerings From Amazon, Pandora

Pandora Announces Potential Catalysts

Separately, Pandora disclosed that it reached direct licensing agreements with Merlin Network, The Orchard, Sony Music, Universal Music Group and over 30 other distributors and independent labels. The company believes that the agreements are a win-win alliance opening fresh avenues for revenue streams for artists and labels.

The company's founder and CEO, Tim Westergren, said, "This was a truly collaborative attempt to find a solution that would support artists while profitably growing our respective businesses."

At time of writing Tuesday, Pandora had risen 2.17 percent to a pre-market price of $14.60.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for P

Oct 2016Bank of AmericaDowngradesNeutralUnderperform
Oct 2016Credit SuisseMaintainsNeutral
Oct 2016Goldman SachsMaintainsBuy

View More Analyst Ratings for P
View the Latest Analyst Ratings

Posted-In: Analyst Color News Short Ideas Barron's Analyst Ratings Movers Tech Media Best of Benzinga


Related Articles (P)

View Comments and Join the Discussion!