Lone Pine Capital, the hedge fund managed by billionaire investor Stephen Mandel, acquired 10,085,216 shares, a 5.3% stake in Pandora Media Inc (NYSE:P), based on its 13G filing with the Securities and Exchange Commission (SEC).
Meena Krishnamsetty and Jake Mann of Insider Monkey noted that Pandora Media, Inc (NYSE:P) belongs in the top 30 stockholdings of Lone Pine Capital’s portfolio. The hedge fund’s position in the internet-radio service provider is passive, which means Mandel purchased its stake in the company because of potential growth.
Pandora's shares surge
Pandora Media Inc (NYSE:P) disclosed that the number of its monthly active listeners for the month of September increased by 25% to 72.7 million from 58.3 million. The internet-radio service provider also reported that its listener hours last month increased from 1.5 billion hours in September last year to 1.36 billion hours, up by 18%. Pandora Media said its total radio listening market share in the United States jumped from 6.53% in the same period a year earlier to 7.77%.
The stock price of Pandora Media Inc (NYSE:P) surged by 4% in pre-market trading, driven by the increase of its monthly active listeners and total radio listening market share in the country. Over the past 52-week range, the stock went up from $7.08 to $27.93 per share. Shares of the company are trading around $27.51 a share as of this writing.
Pandora's financial results
Over the past five quarters, Pandora Media Inc (NYSE:P) reported financial results that were higher than the expectations of Wall Street analysts. In the second quarter of 2013, the company achieved $0.04 earnings per share compared with the $0.02 EPS consensus estimate. Its revenue for the quarter rose by 58% year-over-year to $162 million.
The management of Pandora Media Inc (NYSE:P) implemented a new advertising strategy to boost its profitability by decreasing the length of time between standard in-playlist ads, improving the effectiveness of its video ads, and appointing Brian McAndrews to lead the company. McAndrews is a venture capitalist and an advertising expert.