Apple Inc. (AAPL), Pandora Media Inc (P): This Internet Stock Is in Serious Trouble

Consider Apple Inc. (NASDAQ:AAPL)’s gigantic cash pile (currently $145 billion in cash, equivalents, and short and long-term marketable securities), as well as the strength provided by $41 billion in net profit last year, and you can clearly see that Apple certainly has the financial power to enter a new business if it wants to. Put simply, Apple’s massive innovative and financial resources mean this is a fight that Pandora simply doesn’t want to get into.

Prior to this announcement, I would have considered a potential buyout from Apple Inc. (NASDAQ:AAPL) one of the best reasons to own Pandora. However, with the news that Apple is instead likely to offer a competing service, the buyout premium is gone. Pandora Media Inc (NYSE:P) investors need to take an extremely cautious view of the company in light of this news, and decide whether they’re willing to go to war with the most valuable company on the planet.

The article This Internet Stock Is in Serious Trouble originally appeared on Fool.com and is written by Robert Ciura.

Robert Ciura owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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