Pandora Media Inc. (P) Shares Slip, Investors Watching Closely, Here is Why

Pandora Media Inc. (NYSE: P) shares rose on Monday Nov 21 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.

Meanwhile, stocks were set to open up this morning. The Dow Jones Industrial Average futures YMZ6, +0.20% was 10 points, or less than 0.1%, higher at 18,863, while S&P 500 index futures ESZ6, +0.44% rose 3.95 points, or 0.2%, at 2,184.75. Nasdaq-100 NQZ6, +0.74% added 12.25 points, or 0.2%, to 4,820.75.

Analysts at Vetr Inc. downgraded shares of Pandora Media Inc. (NYSE: P) from Strong-Buy to Buy in a research note to investors today. With a rating of Buy on the shares, the company has a 52-week high of $16.23. As a means of comparison, a number of other analysts have spoken on the company in recent days, and the company has earned a consensus one-year price target of $14.21, above the opening price of $11.31, a difference of 12.49 percent. Considerable and crucial digressions in the company’s operations, future direction or industry can cause downgrades as the analysts consider that the future prospects for the security have weakened from the initial recommendation.

Pandora Media Inc. (NYSE: P) shares last traded at $11.38, a spike of $0.04 or 0.31% from the previous closing price. Opening at $11.31, they varied from $11.26 and $11.41 throughout the day.

Pandora Media Inc. (NYSE: P) now has a market cap of 2.65B.

Pandora Media Inc. (NYSE: P) Average Daily Trading Volume

The stock’s average daily volume is 6,088,320 shares out of a total float 206,296,000 and some 364,107 shares traded hands yesterday, below normal. Trading volume is likely to increase in the next few days as investors often use increases in trading volume to identify large volume aggregation or distribution by institutional investors.

As with all potential breakouts, investors watch for volume to be at least 40%-50% above normal on the breakout to show that fund managers and other professional investors are jumping in.

Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.

These instituitional investors have teams of analysts that investigate thousands of stocks, so it is good corroboration to see them buying a stock you’re researching.

Pandora Media Inc. (NYSE: P) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By identifying trends, moving averages allow investors to make those trends work in their favor and increase the number of winning trades.

Trades for Pandora Media Inc. (NYSE: P) have ranged from $7.10 – 16.230, and the stock now has a 50-day MA of $12.21 and 200-day MA of $12.46. Today’s last price is 29.91%% lower than the 52 week high of $16.23.

Earnings growth is a crucial factor to look at when buying stocks and investors seek companies that have raised their earnings at least 25% or more for the past 3 years.

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