Sirius Weekly Thread 11-30-2009
S&P Downgrades Liberty Media, QVC Ratings After Assets Split
Nov 23, 2009 15:08:08 (ET)
DOW JONES NEWSWIRES
Standard & Poor's Ratings Services downgraded its ratings on Liberty Media Corp. and its QVC business deeper into junk territory after Liberty Media split off some assets into a reorganized DirecTV Group Inc. (DTV).
"The ratings downgrade reflects a significant loss of asset value," said credit analyst Andy Liu.
Liberty, a conglomerate controlled by John Malone, has been taking steps to put its financial house in order after last year's market meltdown. The company's assets are being broken up into three categories, each with its own tracking stock.
Liberty Media now consists of QVC, Starz Entertainment LLC, significant equity stakes in Expedia Inc. (EXPE), Sirius XM Radio Inc. (SIRI) and HSN Inc. (HSNI), and a portfolio of less-strategic investments.
DirecTV had provided support for Liberty Media's holding-company debt, S&P noted. It downgraded Liberty Media and QVC two notches to BB-, three steps below investment grade. The rating outlook is stable. The ratings were removed from watch for possible downgrade, where they were placed last December, months before the spinoff plans were first announced.
Last week, Moody's Investors Service downgraded Liberty Media's ratings to B1, comparable to S&P's new rating. Fitch Ratings lowered its ratings in June after the split was announced.
-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357; Kathy.Shwiff@dowjones.com
(END) Dow Jones Newswires
November 23, 2009 15:08 ET (20:08 GMT)
Analyst Research Reports Update
Thomson Reuters - 11/26/2009 - "OUTPERFORM"
Improvement in TTM Return on Investment - "VERY POSITIVE"
Standard & Poors - 11/28/2009 - "3 STARS" (HOLD)
12 Month Price Target of $1.00 . . . S&P Quality Ranking of "C"
Market Edge - 11/28/2009 - "NEUTRAL"
This is an improvement from "Avoid" to "Neutral." Price opinion formed as of 11/16 is $0.67
Jaywalk Consensus - 11/30/2009 - "2.64"
This is an improvement over 10/31/2009 Consensus of 3.0 . . . 2.64 is moving closer toward "Buy"
Socal's Historic Intuition Target - 11/30/2009 - "WTF"
This is an improvement from Socal's "Mel Sucks" rating issued on 10/31/2009
I knew damn well she wasn't using that golf club to get him out of the Escalade . . as my CSI brother-in-law always says . . he says "SRK, nuthin good ever happens after 2:00 A.M."
Let that be a lesson to you Irish!
"R/S a Net Positive for Siri"
Good news post by BM today recapping Murray Arenson interview . . .
According to BM's report . . . Arenson believes that doing a R/S would be a "net positive" for the company based on removal of barriers to institutional investment . .
My 2 Cents:
I agree with Arenson but believe that "margin buying" would be an even bigger catalyst . . . . once the SP gets to marginable levels . . which might only happen with a R/S . . .
Mel's Advertising Comments
Sirius XM CEO says holiday sales on target
Mon Nov 30, 2009 3:37pm EST
NEW YORK (Reuters) - Holiday sales of Sirius XM Radio's satellite radio players are so far matching expectations, helped in part by an advertising blitz featuring footage of Elvis Presley and Michael Jordan.
Sirius XM Chief Executive Mel Karmazin told Reuters that early retail store checks indicated that sales "were very much on target to what we anticipated" since the U.S. holiday shopping season unofficially kicked off on Friday.
Karmazin partly credited the company's new ad campaign with drawing consumers, since "we didn't have any new revolutionary products out."
He declined to say how much Sirius XM spent on the advertisements -- set to Elvis Presley's "All Shook Up" and showing footage of the rock icon as well as Michael Jordan, Richard Pryor and Howard Stern. Karmazin would only say the campaign cost "a lot of millions of dollars."
After a drawn out merger deal that combined XM and Sirius, but perhaps raised questions about the company's future in the minds of consumers, "we thought it was really important to put a bunch of money behind the brand," Karmazin said.
"We are in the midst of one of the most dramatic year-over-year improvements that I've ever seen in media."
Karmazin said that devices sold over recent days might not immediately show up as new subscriptions.
"What someone will do is buy it, not necessarily activate it. Our activations will take place all the way until the time someone gets it under the tree, finds the new radio and activates it themselves," he said.
(Reporting by Franklin Paul and Paul Thomasch, editing by Tiffany Wu and Gerald E. McCormick)
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