Sine Wave Investor
  • Home
  • Portfolios
  • Compnay Reports
  • Left Turns
  • Media Bias
  • Featured
  • Contact
Pandora
 updated 2/5/18
 
 Entry/Exit Point                                                 $4.50
                                                                                   
52Wk Hi/Lo                                                                4.44 - $13.72
           
P/E                                                                              n/a
 
Profitable or string of losses?                                All losses for 3 years; narrowing
 
Current Ratio                                                              2+ (good)(4.18 per Yahoo pg)                      
- Current Assets divided by Current Liabilities
- Rule of Thumb: 2 is considered adequate for manufacturers        

 
LT Debt as a percent of capitalization                       65%
- LT Debt / LT Debt + OE on balance sheet
 
Interest Coverage Ratio                                              n/c (negative earning = no coverage)
- EBIT / I
- Rule of Thumb for Safety:  3-4

 
Insider Activity                                                          buying at $4-10
 
Short Interest                                                              31%  hi
 
Dividend                                                                     no
 
News Headlines
- Google News
- Seeking Alpha
- ProQuest (1 year)
 
listening hours and ad-supported non-subscription users are down; therefore, ad growth not happening
https://www.cnbc.com/2018/01/08/pandora-shares-slip-after-morgan-stanley-downgrade.html
 
Cannibalization dynamic: switching ad-supported user to subscriber cuts ad revenue.
Adblock users don’t need to become subscribers.
Pandora would still run at a loss even if tripled subscribers
Pandora stalled out in 2014; Spotify is winning
https://seekingalpha.com/article/4135283-pandora-jump-ship-cannibalization-scares
 
WSJ 12/4/17
Pandora to Offer Free, On-Demand Music With Ads, similar to Spotify
users can pinpoint what they want
to give taste of subscription service
 
Most recent earnings press release
 
11/2/17
ads up, subscribers up, revenue up
widening net loss
$499M cash on hand
 
Bottom Line:  INTERESTED AT $4.50
- update 2/5/18 - Pandora was at about $4.20 when I finished my research.  I thought it would go a little lower, but it went up 10 straight days, instead.  It's pulling back now, so $4.50 is a good entry point
- only way to play this is very short-term bounce
- company weak financially but won’t go belly up tomorrow (cash on hand)
- enough conflicting signals about growth to generate sine wave optimism and despair
- last 3 months: lower low’s and lower hi’s.  will double-bottom form at $4 or will decline continue?