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Thread: Pandora down 10% on earnings

  1. #1
    MUSCLE13 is offline
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    Pandora down 10% on earnings

    This is what happens when there is no barrier to entry for internet radio -

    Bloomberg excerpt -

    “Usage is stagnating, I think that’s the fundamental challenge, competition has been starting to take its toll,” Rich Greenfield, an analyst with BTIG LLC, said in a telephone interview. “That’s going to scare the market for what’s supposed to be a rapid growth Internet company.”

    Larger companies are building services to compete with Pandora, such as Google Inc.’s purchase of Songza Media Inc. and Apple Inc.’s acquisition of Beats Electronics LLC. The number of Pandora listeners and the amount of time they spend using the service is little changed on a monthly basis from December to June, said Greenfield, who rates the stock a sell.


    http://www.bloomberg.com/news/2014-0...tml?cmpid=yhoo

  2. #2
    MUSCLE13 is offline
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    By the way my price targets for 2014 year end for Sirius is $3.80 based on 20 times free Cash Flow per share of 19 cents and $4.80 for year end 2015 based on 20 times Free cash flow per share of 24 cents. With all the buyback activity I think my 2015 target may be conservative at this point.

    Take care everybody............Catch you next year.
    Last edited by MUSCLE13; 07-27-2014 at 11:35 AM.

  3. #3
    MUSCLE13 is offline
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    Pandora crushed after earnings again today.........What a surprise Competition causing slowing of growth.

    When there is no barrier to entry for internet radio, how can anyone not have expected an avalanche of competition?

  4. #4
    MUSCLE13 is offline
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    Costs rising, Competition increasing, and Growth slowing. Quite honestly did any sophisticated investor not know what was coming here? I remember Greenfield at BTIG called this years and years ago. I guess it took some time for the market to finally listen to him.

    WSJ -

    http://online.wsj.com/articles/heard...ote-1414180601
    Last edited by MUSCLE13; 10-25-2014 at 12:27 AM.

  5. #5
    MUSCLE13 is offline
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    LOL Look at what Greenfield just wrote today again. How come nobody listened to him before? Mindboggling.

    Rich Greenfield ‏@RichBTIG

    Remember unlike @Netflix, there are no barriers to entry in online music

    BTIG Research

    Pandora

    We continue to believe Pandora is significantly overvalued (link). Last night, management finally admitted that user growth and listening hour growth would be harder to come by going forward as c...


    https://twitter.com/RichBTIG/status/525713070795268097

  6. #6
    Faulkner_SA is offline
    I wrote about all this back in 2012 what about meeee?


    http://seekingalpha.com/article/9257...-moat-no-walls

  7. #7
    MUSCLE13 is offline
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    Quote Originally Posted by Faulkner_SA View Post
    I wrote about all this back in 2012 what about meeee?


    http://seekingalpha.com/article/9257...-moat-no-walls
    Nice article. You know Mel often said and Meyer now says that nothing stops Sirius from doing anything that the internet radio companies do.

    Question of business model I think. It's just a bad business. You know they want to attack it some way but how do you get the EBITDA margins? I don't think anybody has figured that out yet. I think more Sirius internet is coming though either internally or by acquisition. I wish I could see the EBITDA vision in internet radio. I see it in satellite and the connected car business. I haven't seen it in internet radio.

  8. #8
    MUSCLE13 is offline
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    By the way Stephen I am very happy with Sirius' potential right now as opposed to when Mel left. There were just so may question marks. New CEO, Apple entering radio, future of buybacks etc. The whole path that has been taken is almost as if Mel never left. They have stayed the course strategically and financially. And I see it very undervalued on Mel's favorite metric - Free Cash Flow - which Meyer has totally focused on.

    With the aggressive buybacks, and used cars ramping I see $6 per share by year end 2016 based on 20 time FCF per share. Jessica has a 12 month target of $5 based on Discounted cash flow. I see $6 in 2 years. I think we are extremely undervalued. And I definitely did not see that when Mel left. But now they are in a different position. Free Cash Flow Per Share tells the story. This company should have an incredible 2 year run.

  9. Ad Fairy Senior Member

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