The beat and the beats go on at Pandora (NYSE:P). Shares of the streaming music icon soared 26% after posting blowout financial results. A pair of analysts would go on to upgrade the stock, and a third Wall Street pro joined them in jacking up price targets on the shares.

Reported revenue rose a mere 1% to $319.2 million, but back out the money that Pandora generated from the Ticketfly ticketing platform that it sold last summer and its now discontinued operations in Australia and New Zealand, and organic top-line growth rose at a more impressive 12% clip. Pandora's own guidance was calling for just $295 million to $305 million in revenue for the period. Analysts perched themselves near the high end of that range, and it naturally wasn't enough. The stock was off to races after last week's top-line beat, surging its way to a six-month high.

Around the dial 

Pandora's report wasn't perfect. Its user base continues to contract, and advertising revenue is also going the wrong way as improvements in monetization haven't been enough to offset the slide in listenership. There are now 72.3 million active listeners, and quarterly usage dipped below 5 billion hours for the first time in years. Pandora's guidance for the current quarter is also a bit light.

However, the market preferred to emphasize the positive here. Pandora's better-than-expected revenue growth was driven by a 61% surge in subscription revenue. The number of Pandora listeners now paying for premium features is 7.8% of its active listeners with a record 5.63 million people paying for Pandora Plus or Pandora Premium.

A Pandora-sponsored music concert.

Image source: Pandora.

Barton Crockett at B. Riley FBR upgraded the stock from neutral to buy after the report, smitten by Pandora's near-term prospects. He is lifting his price target from $6 to $8. 

Matthew Thornton at SunTrust also boosted his rating on Pandora from hold to buy. He is encouraged by the new management team's plan to restore credibility. He also likes the early success that Premium Access -- a new feature that gives ad-supported listeners a taste of premium features after viewing a 15-second ad -- is having in terms of driving engagement, retention, and conversion. 

Maria Ripps at Canaccord is the third analyst to lift her price target to $8 last week, but she already had a buy rating on the stock so she's sticking to her bullish market call. Ripps feels that Pandora has now pulled off back-to-back quarters of progress. She also points out that while Pandora's audience continues to contract that the defections are coming at a slower pace ahead of the new management team's initiatives to stabilize its listener base. 

Pandora's taking baby steps in the right direction. The AdsWizz acquisition it announced in March that will close later this month will give it a way to beef up the audio ads it will serve in its expanding podcast offerings. Subscription revenue should continue to improve in terms of both the number of people paying Pandora and how much they're shelling out for the service. Pandora's not firing on all cylinders, but you don't have to when you're turning the corner. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.