Analysts Tune Into Pandora, But Competition Rises (P, SIRI, CMLS, ETM, EMMS, SGA)
Shares of Pandora Media (P), the newly public Internet radio provider, are up 1% today after a swath of analysts started new coverage of the stock. Wells Fargo initiated coverage of Pandora with an “outperform” rating and a $21-$23 price target range, implying decent upside from where the stock currently trades. The bank called Pandora “a category leader in the rapidly growing Internet radio market” while adding “Pandora’s unique personalization is highly differentiated and defensible against the competition.”
The bullish sentiment on Pandora isn’t doing much to help the Radio Stocks Index, which is down 0.8%. Citigroup also initiated coverage of Pandora with a “buy” rating and a $25 price target. JPMorgan chimed in with a new “overweight” rating and a $22 price target. William Blair started new coverage of the stock with an “outperform” rating and Morgan Stanley initiated Pandora coverage with an “equal weight” rating.
Pandora does face intense competition from European rival Spotify, which after just one week in the U.S. has already attracted 70,000 paying users. At that rate, Spotify would have 3 million paying users after just one year, Business Insider reported. Rhapsody, the leading paid Internet music service, has just over 800,000 users, according to Business Insider.
Looking at other Index members, Sirius XM Radio (SIRI) is up 2%. Cumulus Media (CMLS) and Entercom Communications (ETM) are both off 4% while Emmis Communications (EMMS) and Saga Communications (SGA) are both lower by 2%.
Investors can track the Radio Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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