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SIRIUS XMs Bullish Future

By
Andrew Montero
– September 19, 2011
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By Andy Montero

Several days ago on September 14th Sirius XM’s(NASDAQ: SIRI) Mel Karmazin presented at the Bank of America/Merrill Lynch Media, Communications and Entertainment conference. What was remarkable about that presentation was the fact that Karmazin, the CEO of Sirius XM was willing to lay out guidance for 2012 quite early compared to other years. As both a subscriber to the service and an investor I found that willingness to be a very bullish sign with regard to the stock price.

Sirius XM reiterated 2011 guidance on revenue of 3 billion, as well as their previous EBITDA guidance of approximately 715 million, and their free cash flow guidance of 400 million dollars. The company went on to present guidance for 2012 with a 10% increase of revenue to approximately 3.3 billion dollars, an EBITDA increase of 20% to 860 million dollars, and an astounding 75% increase in free cash flow to 700 million dollars. Looking at these numbers, it is very easy to see a bullish future in the short term at least, and more than a stretch to see a bearish case right now, even with a struggling economy.

Sirius XM also provided several insights to the Certified Pre Owned vehicle program they have created thru their automotive partnerships. These programs are gaining traction and the company is very happy with the numbers they are seeing, even while stating that the numbers are not as good as the OEM new car program. Karmazin also informed listeners that programming costs are continuing to go down. Karmazin made sure to state that the 2012 guidance was conservative due to the economic climate as a whole.

It’s amazing that some writers out there continue to lie and use fear tactics in the faint hope they can scare some retailers to sell their shares at current prices. Time and again, patience has proven to be the best course of action. Adding to your Sirius position on drops over time has proven to be the name of the game. The company continues to achieve remarkable synergies; the major ones of which we are starting to see now. Again, going forward there is no satellite building or launch costs for at least the next 4 to 5 years. On top of that the company will require less satellite going forward as it currently operates.

Satellite 2.0 will feature pause and replay as well as some other customization features such as on demand, and more channels, approximately 30 more. Many of which will target the Hispanic demographic, as Sirius XM has recognized the importance of the growing Hispanic population and its purchasing power. The channel expansion will include content coming out of Mexico as well as other Latino programming to complement the 3 channels already available on Sirius XM for the Hispanic community. There will be 2 new retail radios coming out in time for the holidays this year that will have 2.0 capabilities. 2.0 capability is expected to be fully integrated into the OEM channel by 2013, but will start appearing in 2012. Sirius XM filed an 8k with details from the media conference and it is available to view on the company website here; http://investor.siriusxm.com/

Disclosure: Long Sirius XM

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3

Taking Oil Speculators and Our Government to Task

By
Andrew Montero
– September 8, 2011
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By Andy Montero

     With the recent drop in the markets, oil prices took a considerable drop as well. We have seen oil prices drop from around 100 bucks to the low to mid 80 dollar price lately. One very noticeable situation has many a consumer annoyed though, as the pump price for gasoline has not dropped correspondingly with the drop in the price of oil. Say what you will, but when oil was going up, the general public watched in horror as the pump price for gasoline flirted with and above 4 dollars in some regions of the country. When oil came down to the low 80 dollar range, it was time to see gasoline drop under 3 bucks. Percentage wise, this was the right price to see. Instead, we have seen gasoline prices hold steady and not drop very significantly at all once they bottomed around 3.50 or so. There may be slightly cheaper gas in some areas, but in general the price has remained above 3 bucks.

There has been no outrage, no political posturing, just a general acceptance that it is what it is. In my opinion, there needs to be some anger and some phone calls made to your elected representatives offices. Those who make a killing speculating with oil are conditioning us to accept whatever they feel like doing. It is borderline criminal that gasoline is over 3 dollars a gallon at this point and totally unacceptable. These prices have caused every company that makes every product or grocery we buy to raise their prices to reflect the higher cost of fuel. Additionally, with jobs paying less, workers and their families are feeling the effects in their commutes and their everyday lives.

If we allow ourselves to be conditioned and do nothing, then we have no one but ourselves to blame. It is time for all of us to speak loudly and demand that gas prices and speculation on oil be thoroughly investigated. Each and every time there are complaints, we are pacified short term only to be screwed over again. We each need to let our representatives in Washington know that we have been paying attention and that we have had more than enough money stolen from us over the course of the past three years. It is time for action unless you think sticking your head in the sand and allowing yourself to be robbed in plain sight is okay. This country has more than enough resources, including oil, to be self sufficient and to ease the ridiculous price of gas on American consumers. It is time to start worrying about the US of A and there is no credible reason to continue the current course of action and allow our nation to be held hostage by OPEC and the Fed. I will add that environmental concerns are valid and need to be minimized, but in no way should they be allowed to prevent the United States from energy independence. It is time to take back our country and regain our standing. No better place to start than with the ridiculous shenanigans taking place with oil. Sorry OPEC that deal certain members of our government made with you so many years ago….its over, we are sick and tired of being abused for the greed of a few!

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When Fear Runs Rampant in the Markets

By
Andrew Montero
– August 23, 2011
By KOAT Staff Writer Andrew Montero - With the unmistakable volatility we have seen over the last month or so in the financial markets, I get asked one question over and over again at times like this…as well as throughout the course of the year. What to do with all this volatility? The answer is a multi layered one, because it depends on where you are financially, how close you are to retirement, what kind of income you currently have, and several other factors.
stressed trader

Stressed Wall Street Trader

By KOAT Staff Writer Andrew Montero -

With the unmistakable volatility we have seen over the last month or so in the financial markets, I get asked one question over and over again at times like this…as well as throughout the course of the year. What to do with all this volatility? The answer is a multi layered one, because it depends on where you are financially, how close you are to retirement, what kind of income you currently have, and several other factors.

If I were to offer any advice right now….it would be to remain patient but alert, and search for the companies and stocks you have faith will stay relevant. Once you do that, you can look at this recent bearishness as a clearance sale, with some equities at 30, 40, even 50% off their normal trading range price right now. Times like these are when those who seize opportunity can rake in huge profits. Again, there are several factors which only you as an investor can determine prior to making a move. Generally, the further away you are from retirement, the riskier you can afford to be, that’s not to say invest in some penny stock, but perhaps you can look at a company with a couple of years to go before it really gets back to solid footing.

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Those of you who are closer to retirement age…or in a position where a large sum of cash will be needed soon….say for your child’s college tuition, will definitely need to avoid any sort of depreciating situation that might take some time for recovery. If you have done well with your portfolio, then you hopefully have some gold or silver you bought at lower prices to counter the current situation, and perhaps that’s where you need to focus now, even as gold is continuing to make many investors shake their heads. Silver is ok too but be cautious how you buy it and the quantities which you purchase as you continue to invest. It is much better with the current trends to buy in several tranches than to go all in right now on anything; and commodities are definitely no exception.

The key to profiting in the current market is patience and proper due diligence. While the markets are causing many to sell on unjustifiable fear at times, there is some serious potential risk out there right now. So long as you do your homework, you have a good opportunity at some juicy potential profits in the short term. Many stocks are trading at ridiculous multiples and prices currently, prices they have no business trading at; yet there they are ripe for the picking. As always, do some good research before you make any investment decision, but if you have some investment capital in hand, there are some interesting potential opportunities out there right now.

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Sirius Is Still My Mistress

By
Gino Lattarulo
– May 17, 2011
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By: Gino Lattarulo

Well what can I say. Even the most careful people can be suckers for a sexy long shot. I mean, I am a monogamous conservative with my trading; working solely from  good solid chart patterns and steady companies. But, I confess, Sirius (NASDAQ:SIRI)  has been my mistress for almost seven years now.  She has punished me, rewarded me, made me sweat, made me sing, and made me so mad that I swore her off for good. She has been the best single malt scotch I have ever had and has caused headaches worse than a tequila hangover on New Years Day. But,  in the last two years Sirius has really made some terrific money for those who truly believed in the product. So how does the  firecracker of Wall Street measure up these days? I think this girl is still smokin’ hot and the charts agree.  At the beginning of May Siri plowed right the $2.00 mark and peaked just over $ 2.40  after the earnings report.  In typical fashion many Wall Street analysts scrambled to adjust their price targets  to avoid looking stupid for failing to do any meaningful research.  Profit taking is now moving the stock down to steadier levels so it can form a new base.  We can see that the price action is near the 20 day  average and  it may retest the    $ 2.00 mark before settling down completely.   If you pull up a weekly chart on Siri you will see the 50 MA starting to thread through the 200 MA, which is exceptional. The next long term resistance point is around $4.00 so unless the world actually ends in 2012, Sirius should be stretching those long legs again and continuing the climb.

NOTE:  Getting into the market right now is very dicey . The leading averages seem to be holding while many stocks are selling off.    Some of the bell weather stocks like  Amazon (NASDAQ: AMZN) , Apple (NASDAQ: AAPL), and Google (NASDAQ: GOOG) all seem to be slipping back to  support levels.  Right now I am 95% in cash and avoiding buying stocks  until we see where things are heading.

As we always said in the military, ” Stand By To Stand By “

Peace

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Berkshire Beat is Overshadowed by Market Ills

By
Andrew Montero
– May 10, 2010
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Berkshire Burlington Northern

Friday Berkshire Hathaway Inc. (NYSE:BRK.A; BRK.B) reported  a $3.6 billion first-quarter profit, helped by a huge one-time holding gain related to its acquisition of Burlington Northern Santa Fe as well as higher income from insurance underwriting and non-insurance related businesses.   Berkshire completed the remaining acquisition of 77.5% of Burlington Northern on February 12th that it did not already own for aggregate consideration of $26.5 billion; which consisted of cash totaling $15.9 billion with the remaining balance paid in Berkshire common stock.  About half of the cash component was funded with existing cash balances and the remaining was funded with proceeds from new debt issued by Berkshire Hathaway.  As of that date, Burlington’s results and net earnings are fully assimilated into Berkshire’s consolidated results and net earnings. Burlington contributed $2.07 billion in revenue and $282 million in net income to Berkshire’s results for the first quarter 2010.  The company’s operating earnings per share easily beat Wall Street expectations.

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