UPDATE: Stifel Nicolaus Reiterates Buy Rating, Lowers PT on Pandora Media on Multiple Risk Factors

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In a report published Friday, Stifel Nicolaus analyst Jordan Rohan reiterated a Buy rating on
Pandora Media
P
, but lowered the price target from $24.00 to $20.00. In the report, Stifel Nicolaus noted, “Checks with music industry sources confirm reports that Apple will announce its entry into the streaming music business at its developer conference next week. That said, very few details about Apple's plans are known, understood, or disclosed. Three key thoughts on Pandora: 1) This is a period of elevated risk for Pandora shareholders, with shares already pricing in some of the risk, down 26% from recent peak vs. -2% for the S&P500 over that same time period. 2) The more the service acts like a Pandora competitor, the greater chance that shares are pressured further. The more it acts like Spotify, subscription on-demand, the less it will impact Pandora. 3) We doubt Apple will be dominant in this venture, but every monthly usage report after the iRadio introduction will some headline risk for Pandora shareholders. We reiterate our view that the profitability per hour continues to improve, but need to find out more about Apple's competitive product offering in the coming weeks and months. We have reduced our price target from $24 to $20 and maintained our BUY rating on the name.” Pandora Media closed on Thursday at $14.31.
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Posted In: Analyst ColorPrice TargetAnalyst RatingsJordan RohanStifel Nicolaus
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