Why Pandora Media (P) Stock Is Down Today

NEW YORK (TheStreet) -- Pandora Media (P) shares are down -5% to $23.50 on Tuesday as investors have reacted negatively following the release of the company's April audience metrics, despite seemingly positive results.

The streaming Internet radio company reported a 30% increase in listener hours to 1.70 billion from last April's 1.31 billion hours.

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The share of total U.S. radio listening jumped nearly two percentage points to 9.28% while the number of active listeners increased 8% to 76 million.

TheStreet Ratings team rates PANDORA MEDIA INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate PANDORA MEDIA INC (P) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been generally deteriorating net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Internet Software & Services industry. The net income has decreased by 1.2% when compared to the same quarter one year ago, dropping from -$28.59 million to -$28.93 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength 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.
  • PANDORA MEDIA INC has improved earnings per share by 12.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PANDORA MEDIA INC reported poor results of -$0.30 versus -$0.19 in the prior year. This year, the market expects an improvement in earnings ($0.16 versus -$0.30).
  • 38.29% is the gross profit margin for PANDORA MEDIA INC which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -14.88% is in-line with the industry average.
  • Net operating cash flow has significantly increased by 82.27% to -$2.24 million when compared to the same quarter last year. In addition, PANDORA MEDIA INC has also vastly surpassed the industry average cash flow growth rate of 22.53%.
  • You can view the full analysis from the report here: P Ratings Report
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