Cowen Maintains Pandora (P) at 'Outperform' into Q1 Results; Guidance Will Be Key

Pandora Media (NYSE: P) is positive Thursday heading into th company's FQ114 results, which are expected out after markets close today.

Cowen and Company sees Pandora posting Q1 revenue of $176 million with adjusted loss of $.14 per share, with consensus esimates looking for revs of $175 million and loss of $.14 per share. Analyst John Blackledge noted, Our topline forecast is driven by estimated advertising revenue of $137 million, up 42% y/y, driven by total mobile ad revenue of $101 million, up 55% y/y due to rising audio ad revenue; we expect subscription revenue of $39 million vs. $18 million last year and flat q/q. We forecast EBITDA of -$27 million (vs. -$30 million last year).

Key points investors should focus on, according to Blackledge, include:

1. The pace of audio advertising loads throughout the quarter and advertiser adoption;

2. the growth, productivity and traction of the local salesforce;

3. any commentary on the auto opportunity, which could be a significant catalyst over time;

4. guidance for 2Q and any update to 2014 FY which calls for revenues of $870-890MM and Non-GAAP EPS $0.13-0.17; and

5. Finally, we will look for any commentary on the competitive environment and whether Spotify, iTunes Radio or other competitors have impacted listening behavior.

Cowen has Pandora at Outperform with a price target of $41.

Money flow on Pandora is negative $2.09 million in late-morning trading, suggesting selling pressure on the name. Short interest is at 14.5 million shares, or 7.8 percent of float.

For an analyst ratings summary and ratings history on Pandora click here. For more ratings news on Pandora click here.

Shares of Pandora closed at $28.17 yesterday.

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