Pandora (P) Stock Closed Down After Apple Introduces Rival Music Streaming Service

NEW YORK (TheStreet) -- Shares of Pandora Media (P) closed down 3.75% to $17.70 in Monday's regular trading session, after Apple (AAPL) unveiled a competing music streaming service called Apple Music at its Worldwide Developers Conference in San Francisco earlier today, CNBC reports.

Apple's new subscription service, which costs $9.99 per month, will be available starting June 30.

Apple Music will also feature a music station, and will allow artists to share music and photos on its platform, CNBC added.

Oakland, Calif.-based Pandora provides Internet radio services on smartphones, tablets, traditional computers and car audio systems, as well as a range of other Internet-connected devices.

Pandora provides service through two models including a free service and Pandora One, generating revenue from advertising.

The company's playlist generates algorithms that predict listener music preferences.

Insight from TheStreet's Research Team:

Eric Jackson commented on Pandora in a recent post on RealMoney.com. Here is a snippet of what Jackson had to say about the stock:

One of the early down stocks today, ahead of the Apple  (AAPL) Worldwide Developers Conference in San Francisco, is Pandora Media  (P). As of this writing, the stock is down 1.5%.

This is, of course, due to the expected announcement today that Apple is launching a new and improved music streaming service. Apparently, the company was trying to finalize deals with all the key music labels over the weekend.

Yesterday, VentureBeat printed this quote from Sony Music's leading executive about the new service:

"It's happening tomorrow ... What does Apple bring to this? ... Well, they've got $178 billion in the bank. And they have 800 million credit cards in iTunes. Spotify has never really advertised because it's never been profitable. My guess is that Apple will promote this like crazy and I think that will have a halo effect on the streaming business. ... A rising tide will lift all boats. ... It's the beginning of an amazing moment for our industry."

Although he didn't mention Pandora, the comment about Spotify is damning by association. Pandora also didn't have profitable EBITDA in the past year. However, does that mean the company is doomed? I don't think so.

- Eric Jackson, 'Is This the End for Pandora -- or a New Beginning?' originally published 6/8/2015 on RealMoney.com.

Want more information like this from Eric Jackson BEFORE your stock moves? Learn more about RealMoney.com now.

Separately, 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 few notable weaknesses, 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."

You can view the full analysis from the report here: P Ratings Report

More from Markets

Podcast: What TheStreet's Interns Learned From Jim Cramer and Action Alerts PLUS

Podcast: What TheStreet's Interns Learned From Jim Cramer and Action Alerts PLUS

Bank of America, Tariffs and the Goldman Sachs CEO Change: Jim Cramer Rewind

Bank of America, Tariffs and the Goldman Sachs CEO Change: Jim Cramer Rewind

Here's Why Alphabet, Facebook and Amazon Earnings May Overshadow Tariff Worries

Here's Why Alphabet, Facebook and Amazon Earnings May Overshadow Tariff Worries

NYSE Trader Expects Blowout Earnings From Alphabet, Amazon and Facebook

NYSE Trader Expects Blowout Earnings From Alphabet, Amazon and Facebook

Don't Panic! The Risk of a Recession This Year Is Low

Don't Panic! The Risk of a Recession This Year Is Low