Pandora Media (P) & Beasley Broadcast Group (BBGI) Critical Review

Pandora Media (NYSE: P) and Beasley Broadcast Group (NASDAQ:BBGI) are both small-cap cyclical consumer goods & services companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Institutional and Insider Ownership

14.6% of Beasley Broadcast Group shares are owned by institutional investors. 2.6% of Pandora Media shares are owned by company insiders. Comparatively, 61.6% of Beasley Broadcast Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Pandora Media and Beasley Broadcast Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pandora Media $1.38 billion 0.88 -$342.97 million ($2.49) -1.97
Beasley Broadcast Group $136.66 million 2.68 $47.48 million $2.20 5.77

Beasley Broadcast Group has lower revenue, but higher earnings than Pandora Media. Pandora Media is trading at a lower price-to-earnings ratio than Beasley Broadcast Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Pandora Media and Beasley Broadcast Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pandora Media 2 23 11 0 2.25
Beasley Broadcast Group 0 0 0 0 N/A

Pandora Media currently has a consensus target price of $10.31, suggesting a potential upside of 109.95%. Given Pandora Media’s higher probable upside, research analysts plainly believe Pandora Media is more favorable than Beasley Broadcast Group.

Risk and Volatility

Pandora Media has a beta of -0.48, meaning that its stock price is 148% less volatile than the S&P 500. Comparatively, Beasley Broadcast Group has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Profitability

This table compares Pandora Media and Beasley Broadcast Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pandora Media -39.49% -74.78% -23.38%
Beasley Broadcast Group 25.94% 12.35% 4.05%

Dividends

Beasley Broadcast Group pays an annual dividend of $0.18 per share and has a dividend yield of 1.4%. Pandora Media does not pay a dividend. Beasley Broadcast Group pays out 8.2% of its earnings in the form of a dividend.

Summary

Beasley Broadcast Group beats Pandora Media on 11 of the 15 factors compared between the two stocks.

Pandora Media Company Profile

Pandora Media, Inc. (Pandora) is a music discovery platform, offering a personalized experience for each of its listeners wherever and whenever they want to listen to music, whether through earbuds, car speakers or live on stage. The Company delivers targeted messages to its listeners using a combination of audio, display and video advertisements. Its segments include Pandora-Internet Radio Service and Ticketfly. As of December 31, 2016, it provided Pandora service through two models: advertising-supported service and subscription service-Pandora Plus. Pandora is integrated with connected devices, including automobiles, automotive aftermarket devices and consumer electronic devices. Its Ticketfly service is a cloud ticketing platform for live events. It operates ticketing service through its subsidiary, Ticketfly, a live events technology company that provides ticketing and marketing software and services for its clients, which are venues and event promoters, across North America.

Beasley Broadcast Group Company Profile

Beasley Broadcast Group, Inc. is a radio broadcasting company. The Company’s primary business is operating radio stations throughout the United States. As of December 31, 2016, the Company owned and operated 63 radio stations in various radio markets, Atlanta and Augusta in Georgia; Boston, Massachusetts; Charlotte, North Carolina; Detroit, Michigan; Fayetteville, North Carolina; Fort Myers-Naples, Florida; Las Vegas, Nevada; Middlesex, New Jersey; Monmouth, New Jersey; Morristown, New Jersey; Philadelphia, Pennsylvania; Tampa-Saint Petersburg, Florida; West Palm Beach-Boca Raton, Florida, and Wilmington, Delaware. The Company operates its radio stations in clusters to capture a range of demographic listener groups.

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