Image source: Pandora Media.

It's starting to seem like a broken record, but Pandora Media (NYSE:P) is once again moving higher on buyout speculation. Shares of the music-streaming pioneer soared 20.5% last week, moving higher after CNBC's David Faber said key investors are encouraging Pandora to explore a sale. Faber cites unnamed sources claiming that Pandora is now open to a deal with alleged former suitor Sirius XM Radio (NASDAQ:SIRI), and that the satellite-radio operator will pursue a potential pairing.

The Wall Street Journal had reported this summer that Sirius XM, through its controlling stakeholder, had offered to buy Pandora at $15 a share. Pandora's board reportedly rebuffed the unsolicited buyout offer. With Pandora stock kicking off last week barely above $11, it's easy to see why key investors would be nudging the one-time dot-com darling to consider cashing out at a reasonable premium.

There were conflicting media reports following Faber's televised segment. Bloomberg reported that Sirius XM Chairman Greg Maffei did approach Pandora, and that advisors at the streaming-music service were starting to reach out to other potential bidders. However, Reuters countered CNBC's report by claiming that Pandora isn't renewing efforts to be acquired. 

Singing a different tune

Pandora's in a funk, and we're not talking about the music genre. Revenue grew just 13% in its latest quarter, its weakest year-over-year uptick as a public company.

Pandora's popularity has stalled. It closed out the third quarter with 77.9 million active listeners, just shy of the 78.1 million on its rolls a year earlier. Online advertising revenue rose 7% as it continues to get marketers to pay more to reach its listeners, but subscription revenue took a 1% hit. The only reason Pandora managed to post double-digit growth on the top line is that it recently threw its hat into the ticketing-service ring.

Stagnant fundamentals may seem to make Pandora a lousy takeover target, but it remains valuable as the top brand in this niche. Listeners streamed 5.4 billion hours last quarter, 5% more than a year earlier. Work the math, and it means that Pandora's nearly 78 million listeners are tuning in for a whopping 23 hours of content per month.

Pandora's growth prospects may be dim, but there's value in its massive installed base that continues to use the service with growing frequency. Sirius XM would be able to enhance its premium satellite receiver-based offering with a strong online component, and the cross-marketing potential is obvious.

Rumors that Pandora is being acquired seem to creep up when the stock is in a rut, but a buyout at the right price makes sense in any scenario. If something doesn't materialize this time around, it's a safe bet we'll be revisiting this scene the next time Pandora stock falls into the pre-teens. This is just what broken records do.