This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Bearish Because of Bieber? A Flawed Take on Pandora

Stocks in this article: P

NEW YORK ( TheStreet) -- On Wednesday, Spotify announced it will launch service in Canada. I waited for the obligatory "cautious mention" of Pandora (P - Get Report) from BTIG Media's Richard Greenfield, but, as far as I know, it never came. Maybe Greenfield just decided to stop embarrassing himself.

Even though I disagree, I have no problem with Greenfield sharing his bearish takes on Pandora. I do, however, take exception to what seems like a vendetta against the company and the asinine notes, which my Briefing.com feed refers to as cautious mentions, Greenfield releases to support his position.

Boys Who Cry Wolf

Broadly speaking, Greenfield situates practically any piece of news from the Internet radio space as a significant encroachment on Pandora's dominance in the area.

Case in point: Back in June, Greenfield not only touted Songza, he warned that Pandora investors "should be concerned" because the new (and impressive) streaming music service's app exploded to the top of the iOS charts. Indeed, Songza did spend considerable time at No. 2, roughly 20 spots ahead of Pandora. I blasted Greenfield for acting like it mattered.

Two months after Greenfield's misinterpretation of app data as research, I'm proven right.

As Apple's (AAPL) iTunes Free Apps chart shows, Pandora now ranks 30th; Songza no longer shows up on the list.

Greenfield clearly does not understand how Apple ranks apps. You can explode to the top of the charts. It's quite a bit more difficult to stay there. Plus, the standings change daily. As I wrote this, among Internet radio apps, Spotify was No. 20, Pandora was No. 30 and iHeart Radio was No. 60. By now, those numbers might have shifted.

Unfortunately being wrong doesn't stop the inanity. And, let me be clear, I am not talking about being wrong about a stock or even a company's outlook. I was right there with Greenfield for the fall of Zynga (ZNGA).

Bieber Beliebes in Songza

I received an email with a Greenfield note from Aug. 8. He actually had the nerve to refer to "the blog we wrote" earlier in the year on "new Pandora competitor" Songza, as if it still contains even a shred of credibility. He then directed his audience -- and dear God, I hope they're not paying clients -- to the Twitter account of Justin Bieber:

so @alfredoflores just showed me @songza for workout playlists. Why didn't any of my 26million best friends show me this? #whichplaylist

I'm as much of a Belieber as his other 26 million followers, but, please, for Greenfield to direct people who are, presumably, investors to that tweet and then the subsequent positive reaction from Bieber's fans represents a new low in the industry. To top it off, he even presents unscientific research poorly. Maybe Bieber's 26 million friends didn't show him that because they don't use Songza?

In any event, Greenfield lacks a comprehensive understanding of Pandora's business model and its strategic-competitive position in the new media space. Because of this, he resorts to simplistic, surface-scratch tactics to build what amounts to a non-case. And, from time to time, when Briefing gives him the time of day or CNBC puts him on TV, he moves Pandora's stock. That's bad for Wall Street and it's bad for investors.

At the time of publication, the author was long P and ZNGA.

Rocco Pendola is a private investor with nearly 20 years experience in various forms of media, ranging from radio to print. His work has appeared in academic journals as well as dozens of online and offline publications. He uses his broad experience to help inform his coverage of the stock market, primarily in the technology, Internet and new media spaces. He has taken a long-term approach to investing, focusing on dividend-paying stocks, since he opened his first account as a teenager. Pendola, 37, is based in Santa Monica, Calif., where he lives with his wife and child.

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs