Analysts Radio in a New Pandora Stock High

Pandora

Zacks analysts maintained their bullish outlook for Pandora (NYSE:P) shares Monday as the firm reported a new 52-week stock high for the automated music recommendation service. Pandora Media ended last week at $31.56, just slightly down from the day’s record high of $31.94, and that reflected an impressive one-year return of about 320.2 percent and a year-to-date return of about 232.6 percent. The company’s recent successes can be seen in its latest earnings and market share maintenance despite new competition in the industry.

According to Zacks, Pandora has now delivered a positive earnings surprise of 150 percent over the past four quarters, and the music giant’s latest fiscal second quarter earnings only helped its cause. The company reported a revenue that reflected a 58 percent jump from the year-ago quarter, and mobile revenue especially grew as it surged 92 percent to $116 million.

The impressive figures prove that Pandora is not being muscled out of its respective music sharing space despite new competition from iTunes Radio a la Apple (NASDAQ:AAPL). When the fresh service rolled out in September, many analysts shared the concern that Pandora would lose listeners to iOS 7′s latest feature, but as it turned out, the Oakland, California-based company actually stood to benefit from the competition as its listening hours grew 9 percent in October versus September.

Zacks’s report Monday also highlighted Pandora’s productivity at increasing monetization, evidenced by its 31.8 percent year-over-year surge in total advertising revenue per thousand listener hours. Also in Pandora’s fiscal second-quarter, listener hours improved 18.0 percent year-over-year to 3.88 billion while active users increased 30.0 percent to 71.2 million by the end of the quarter.

Thus, analysts remain confident that the company has a tight grip on its market share, despite increased competition from Apple, and although its active listener base continues to decline on a month-over-month basis, its increased monetization ability coupled with its well-established infrastructure is expected to help facilitate future success for the online radio pioneer.

Zacks analysts maintained their fiscal third-quarter estimate for Pandora Monday, forecasting earnings of a penny over the past 30 days, but the company’s stock price suffered losses Tuesday, closing in New York down 3.26 percent at $28.74.

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