SIRI Intraday Updates for the Week of 2/09/09

Wow, what a week last week huh?! Up to 20 cents and change, then all the way backdown to 0.1295. Talk about a bipolar stock...

So what do we have in store for us this week?


Just last night (Sunday) the Wall Street Journal published another article regarding Echostar and Sirius. You can read the full article here.

Many people (including myself) are fed up with the term "according to a source familiar with the situation..." but a lot of information in that article is indeed interesting. While everyone is bashing the article, I think the biggest part of it that no one is picking up on is where it says this:

Quote:

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Originally Posted by Wall Street Journal

Mr. Ergen isn't seeking to force Sirius into bankruptcy proceedings in order to acquire its assets more cheaply, according to a person familiar with his strategy.

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This fact right here means that Ergen is not trying to force bankruptcy, which means that current shareholders will not loose everything. There may be a buyout, but then all shareholders will get either cash or stock. If you have a high cost average, you might end up getting screwed, but if you have averaged down to a low cost average, you might make out half way decently.


The other issue that I have is this: As I posted over here, Echostar as of their last 10Q had about 963 million in cash and 360 million in outstanding debt.
Looking into Dish Network's latest 10Q, they have another 971 million in cash on hand and about 4.75 billion in outstanding debt. Either company could buy a substantial portion of the 2009 debt, but it would leave them pretty strapped for cash. It should also be mentioned that Ergen is estimated to be the 54th richest man in the world.

Key things that have to be in the back of our mind:

1) Would this be a good purchase?
2) Does Ergen really think the FCC and DoJ approve this? (IN A TIMELY MANNER)
3) Sirius still needs to announce Q4 and YE2008 Results. Will the announcement for the date be this week?
4) How well did Sirius do getting people to lock in long term contracts?
5) How well is the Best of Both taking?
6) Does Mel believe in this company to throw his own money at the debt? Remember, HE was the one that mentioned that possibility...
7) Does Mel really want to work under Ergen?

Inquiring minds want to know... and it will continue to get interesting.

Discuss.

is their a possibility they could have a partnership that doesnt involve a take over?

just heard a commercial for the mini cooper on stern show, good sign as i have not heard any new advertiser's in a while. hopefully this is a sign that the advertising market is improving.

avging a volumw of about 20 mil an hour, hopefully we can gain some momentum going into the end of the day, im sick of these level's we need to break the hell out already.

Ya me too! Isnt it funny no one ever complaines about advertising on howard!

He's a money maker!

Quote:

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Originally Posted by trippingthespeculatingpos

is their a possibility they could have a partnership that doesnt involve a take over?

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Thats what I've been thinking!

hold on tight their trying to shake people off.

im like a deer caught in headlight's right now, and im damn sure not moving, hope i dont turn into a bloody mess.

*epiphany* some1 has alot of shares to cover and these bs stories are the perfect cover to lower the price even more and cover last minute before big news from mel. Im not talking about any old person covering their short position, im talking GS mofo!!!

TALK BACK: Sirius Should Start Moderate Radio/TV Ad Sales
Last update: 2/9/2009 12:14:02 PM
An executive at a Las Vegas cargo company responds to The Wall Street Journal column item "HEARD ON THE STREET: Sirius About Staying Aloft" by Martin Peers:
I believe the future holds great promise for Sirius and own over 1 million shares of its stock. However, the company must be managed more efficiently and cost-effectively if it is to persevere in these uncertain times.
With auto sales down and nearly a third of its $3 billion in debt coming due this year, it is imperative that corrective measures be taken immediately to generate more revenue via moderate radio/TV advertising sales. While some listeners might be appalled at the idea of commercials, without the revenue generated from them, Sirius will not stand on its own and most likely be acquired by one of the satellite television networks.
As a long-term investor, I feel either option is beneficial at the current stock price but as a fan of music, I would prefer that the current management implement change instead of the likes of DirecTV, which shall advertise like every other radio station.
(TALK BACK comments may well be submitted by readers who have a financial interest in the securities that are being discussed.)
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Here's the original column:
HEARD ON THE STREET: Sirius About Staying Aloft
Mel Karmazin undoubtedly hasn't forgotten the four tumultuous years he spent shacked up at Viacom with Sumner Redstone. So it's a good bet the CEO of Sirius XM Radio doesn't fancy the prospect of working for another strong-willed mogul: Charlie Ergen.
For that reason alone Mr. Karmazin is sure to spend the next 10 days searching high and low for $175 million he needs to pay off bonds held by Mr. Ergen's Echostar Technologies. Otherwise he faces the prospect of Echostar trying to muscle its way to at least partial control of Sirius.
Don't bet against Mr. Karmazin. Beneath the roughly $3.2 billion of debt now dragging the satellite radio company back to earth lies a decent business with around 19 million subscribers. Cost cuts flowing from last summer's merger of Sirius and XM should take the company nearer to profitability - although the recession will hardly help.
Sirius could prove attractive to companies like Verizon or AT&T, both of which have national wireless footprints that might dovetail with a satellite-radio service. Liberty Media could also be sniffing around.
Still, Sirius needs serious money. Leaving aside next week's bond maturity, the company has $350 million in bank debt due in May and another $400 million in bonds due in December. Without the means to deal with those maturities, paying off next week's bonds only buys a little time.
One thing is sure. Having sunk $2.7 million into Sirius stock just last August, Mr. Karmazin will be keen to avoid a Sirius bankruptcy filing. If he has to yield to Mr. Ergen to avoid that, he likely will. Then Wall Street can settle in for a new clash on the corporate airwaves.
(END) Dow Jones Newswires