In a research report issued today, Canaccord analyst Michael Graham reiterated a Buy rating on shares of Pandora Media Inc (NYSE:P) with a price target of $26, following the news that the company is close to a deal to buy Ticketfly, a ticketing agency that specializes in smaller venues, for $450 million in a cash/stock transaction.
Graham wrote, “Ticketfly would be highly complementary to Pandora’s Artist Marketing Platform and potential “steering” service. Artists can focus on cities where Pandora listening indicates a fan base, and Pandora can “steer” heavier listening in markets where concerts are about to happen (potentially paying lower royalties as compensation for this marketing service). We could also envision content opportunities with Pandora live-streaming concerts from affiliated venues, potentially on a “pay-perevent” basis.”
“We believe Ticketfly would complement Pandora’s business nicely, with revenue synergies from increasing the density of connections among artists, venue operators, and event promoters that can all leverage the marketing data generated by 80 million + Pandora listeners. We continue to believe Pandora is on track for a solid end to 2015, a reasonable CRB outcome, and a 2016 marked by several expansion opportunities,” the analyst concluded.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Michael Graham has a total average return of 10.0% and a 51.8% success rate. Graham has a 28.2% average return when recommending P, and is ranked #244 out of 3769 analysts.
Out of the 31 analysts polled by TipRanks, 21 rate Pandora Media stock a Buy, 9 rate the stock a Hold and 1 recommends a Sell. With a return potential of 13%, the stock’s consensus target price stands at $23.23.