July 25, 2011 / 1:22 PM / 7 years ago

Pandora Media gets thumbs-up from two brokerages

(Reuters) - Two brokerages started coverage on Pandora Media Inc with positive ratings citing its exciting long-term growth opportunity given the growth in Internet radio and the ongoing shift of advertising dollars to the Web and mobile environments.

Shares of the online radio company, which debuted on the New York Stock Exchange in mid-June, were up 2 percent in premarket trade.

“Pandora is well positioned to take share of the U.S. online display, mobile and radio advertising markets,” JP Morgan’s Doug Anmuth said in a note to clients, adding it represents a $37 billion opportunity (combined) by 2014.

Anmuth, who started Pandora with an “overweight” rating, said there was significant opportunity for Pandora to improve the monetization of its listener hours.

“(Pandora’s)ability to monetize mobile hours will improve over the next few years and drop down to the bottom line,” Analyst Anmuth said.

Wells Fargo Securities’ Jason Maynard started Pandora shares with an “outperform” rating and said the company, — a leader in internet listener hours — represents just 3.6 percent of all radio listener hours, providing ample share gain opportunities.

Pandora competes against traditional radio companies, satellite radio provider Sirius XM Radio Inc, music services such as Rhapsody and offerings from Apple Inc, Google Inc and Amazon.com Inc.

Pandora shares, which had debuted on the market at $20 in June — 25 percent above its initial public offering price, have shed 35 percent of their value over the last one month.

Pandora shares were up 39 cents, or 2 percent, at $18.42 in premarket trade.

Reporting by Saqib Iqbal Ahmed in Bangalore; Editing by Prem Udayabhanu

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