Will Competition From Spotify And Apple Music Hurt Pandora?

Pandora (NYSE:P) had run into its fair share of troubles in 2015. The stock ended 2015 down 25%, closing the year at $13.41.

Source: Pandora stock price data by amigobulls.com

Investors were punished after a rather disappointing guidance in the last earnings release. Pandora stock price fell by over 25% in a few hours following the earnings release, on news that the company will be hit by a royalty settlement of $90 million over the coming quarters, which depressed earnings estimates. While the revenue trend has been on a rise, the increasing revenues also mean increasing content costs.

With increased competition from Apple music and Spotify, the company's premium service, Pandora One, is not offering a service that is compelling listeners to sign on even as revenue has increased significantly year over year. Should investors look to buy in with a discounted stock price? Watch the above video to find out.