SIRI Intraday Thread: Tuesday April 7
Let us make today's theme "Bash Motely Fool" .
As much as I hate clicking over there, yesterday's dueling Fools featured Rick M. giving the bullish side of Sirius XM, while Tim B gave the bearish side. Relmor chimed in first.
Quote:
Originally Posted by Relmore/Fredlee
And I see your still ignorant then.
The debt is priced in. Sorry to inform you. Why its only .35 cents. Dilution is priced in, when I factor their market cap, I already assume the Liberty deal, as does every real analyst on the planet. They are still projecting higher price targets. Now the debt. They only need to keep their current subs(yes I didnt stutter, you heard me right) and they are positive EBITA right there. Add more and its gravy. Add more cost savings from the merger, no more XM writedowns(you saw the last one last report), they received cash from MLB escrow account, signing talent WILL NEVER COST MORE THAN TODAY, and dwindlling advertising revenue from terrestrial radio, and the 30 million new possible subs instantly(iphone app, ipod), add deeper penetration rates in car installs, add the worst car sales in the modern era(only go up now), and you will see why that debt is only a hinderance to higher profit levels, not a problem to be paid off in installments as required. Not to mention an extremely nice debtor for once(a debtor who has more interest in it suceeding than failing), and you will know why you indeed write for the "fool", and talk to fools.
My reply is right under his:
Quote:
Originally Posted by Newman
Anyone who is invested in Sirius who does not know about the dilution must be watching too much Cramer. They announced the dilution fact, and the stock trippled. The stock price is priced in for dilution already, just like it was priced for bankruptcy before.
As far as EVERYTHING else you mentioned:
You seem to ignore the fact that we are in one of the worst economic environments in years. The reason that Sirius had to borrow money at 15% interest was because NO ONE was lending money. The fact that they SUCCESSFULLY negotiated ANY loan to stave off bankruptcy should show how strong of a company they were and still are. Yes, there will be future refinancing necessary, but it will be done in a much friendlier economy.
You mention tons of debt, but what you FAIL to mention is the fact that the company will be EBITDA positive for the full year 2009 according to their forecasts to the tune of "at least 300 million". You forget to mention that costs have been dropping nearly as fast as the Motley Fool's subscriber numbers, while revenues have increased significantly. You forget to mention that due to synergies with satellite CAPEX, they will be able to maintain half of the satellites as a single company.
It is convienient that you leave out so much information that would hurt your case. Your entire argument is based on th future, yet you base all of your assumptions on todays environment.
Newman
http://www.SiriusBuzz.com
After thinking about it a bit, I don't think we need to bash the Fool... I think we need to start SUPPORTING Rick M. If we all flood to the Fool and start posting on the negative articles, they will continue posting them because they know we will rag them on it. They don't care about content, they care about hits. Instead, we will all start PUMPING Rick M.'s articles. Maybe if they see that a ton of people are supporting the Bull, they will start posting more bullish comments?
Discuss...