Trade-Ideas LLC identified

Pandora Media

(

P

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Pandora Media as such a stock due to the following factors:

  • P has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $91.9 million.
  • P has traded 5.4 million shares today.
  • P traded in a range 230.3% of the normal price range with a price range of $0.94.
  • P traded above its daily resistance level (quality: 5 days, meaning that the stock is crossing a resistance level set by the last 5 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on P:

Pandora Media, Inc. provides Internet music streaming services in North America. P has a PE ratio of 26. Currently there are 12 analysts that rate Pandora Media a buy, no analysts rate it a sell, and 14 rate it a hold.

The average volume for Pandora Media has been 8.2 million shares per day over the past 30 days. Pandora Media has a market cap of $2.9 billion and is part of the services sector and media industry. The stock has a beta of -0.76 and a short float of 23.6% with 6.79 days to cover. Shares are down 7.9% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Pandora Media as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 138.5% when compared to the same quarter one year ago, falling from -$48.26 million to -$115.10 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, PANDORA MEDIA INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for PANDORA MEDIA INC is currently lower than what is desirable, coming in at 34.87%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -38.71% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$13.10 million or 148.56% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The share price of PANDORA MEDIA INC has not done very well: it is down 14.50% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

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