By Relmor Demitrius
Sirius XM (NASDAQ:SIRI) issued a press release yesterday stating a return to subscriber growth from a 404,000 retail subscriber loss in the first quarter of 2009. They had 171,000 net additions in Q1 of 2010. They also stated a confirmation on guidance in revenue and EBITDA growth as on pace with estimates. This means 20% growth in EBITDA and a high single digit growth in revenue is in play for this conference call coming up in May. They must report by mid May according to their SEC filing requirements.
Based on this information S&P has reiterated its Hold rating on shares of Sirius XM. S&P sees the 20% EBITDA growth and 7% growth in revenue as possibly conservative. They see autos continue to rebound and this should bloster their subscriber numbers going forward. S&P has been bullish the company since below 60 cents, yet hasn’t moved off its Hold rating.
If you were to “Hold” on this stock any longer, it might be over $2 a share before these “market visonaries” get around to changing it to a buy.
Janco Partners recently gave Sirius XM an upgrade to “Buy” and a price target move from 80 cents to $1.30. This upgrade actually came before the press release from Sirius XM.
These are the first reports and effects of the kind of quarter Sirius XM is expected to have. Strong growth, steady revenue increases, and continued across the board cost cutting efforts are drawing a flame once again to shares. Volume spiked strongly on the report, and shares rose from a close near 96 cents on Tuesday, to a high of 1.09 in AH late Wednesday.
Shares this morning in premarket have traded as high as 1.14 today, up over 5%.
Shares of Liberty Media’s tracking stock Liberty Capital (NASDAQ:LCAPA), which houses their 40% stake in Sirius XM was up modestly on Wednesday to $42.18.
Long SIRI
Once again Rel thanks for being one of the very few sticking in there in Feb 2009 to keep investors informed of the companies true value. An 1100% gain and growing is a noteworthy gain and usually warrants some gratitude which i hope is felt by yourself and a few others by myself. Upside from here is inevitable. Growth, Buyout its all good. Reverse positions and losses mounting for the shorts makes it an even sweeter victory here.
Wall Street analysts are a joke. They are true “followers” and by the time they award a Buy rating it is probably closer to a Sell. Look at how these jerks handled the 2001 fiasco – riding Buys and Holds all the way to the bottom and finally issuing Sells right at the floor.
They have already missed the massive gains of Sirius XM and have been late on every development. While more massive gains continue to lie ahead, most of these bozos will not wake up until the rest of us have already reaped rewards of close to 1000%.
They issue buy ratings when the stock is on a guaranteed run and love to post these results one their websites. To a novice who does’t know how to look they may appear impressive. I can sit here all day posting buy ratings after positive news releases and sell ratings after negative releases. Thats all they are doing. It takes some skill to look a stock in the eye and see a 2 to 5 year path. I will personally issue a buy rating at todays price. A buy rating should be with a real 12 month target. My take is that birds of a feather fly together and i think we will see similar runs on SIRI that reflect many equities that have hit such a bottom and rebounded. My personal opinion is that SIRI will eventually overshoot short term to $2 or possibly higher and pull back to near $1.50 or higher. My plan is to issue covered calls on this run and buy back to cover when the pullback occurs and use the profits to add shares at that price. Currently i am margined all the way to .11 with some important buys happening in Feb 2009 with the help of a few who kept the outline of this company clear to me. Let us see what SIRI brings.
You guys are doing a fantastic job by truly reporting actual facts and making reasonable assessments. You are simply the best.
I believe that today’s siri value is at least $15B, which means if, say, Liberty were buying the remaining 60% of the company, siri should be asking at least $9B for 3.8B shares. And this is today. At the end of the year, if siri grows as we anticipate and there is no reason whatsoever to doubt that, the company value should be $20B, with 12B for 60% of the company. This is simple math that these analysts need to comprehend if they still have a vestige of brain power left. To miss subscriber growth estimate by 330K is insulting. Even I predicted subscriber growth between 60K and 90K, which is at least three times better.
I think S&P are idiots. You go ahead and wait till it’s $2. I bought most of my shares @ .12 no thanks to folks like Cramer, S&P, Motely Fool, CNBC and a host of others.
Just the facts, that’s what I like about KOAT…nice article, Rel. Although S & P didn’t upgrade the equity at this time, their positive remarks indicate to me that an upgrade will be coming soon. Also, I still expect an upgrade in the credit rating from S & P with the consistent improvement in the balance sheet…also, look for a credit upgrade from Moodys for the same reason, but all this is just my opinion based on improving fundamentals.
Like nearly all analysts they will issue an upgrade after Q1 reports come out. I like to follow the analysts who stick their neck out and issue upgrades before hand like Janco did even though they did only after positive news as well. This isn’t rocket science and one only needs to believe in a product they invest in. I use the product and invest in it relentlessly which has way more than paid for all my usage of it for the next 150 years.
My hope is that the stock will close above $1.05 today to illustrate to shorts that this is a losing battle.