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Thread: Siri Stock Thread Nov 2011

  1. #1
    Sirius Roadkill is offline
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    Siri Stock Thread Nov 2011

    Quote Originally Posted by socalrunningfool View Post
    Melissa Lee, "Porn: Business of Pleasure"
    http://www.youtube.com/watch?v=Za4ZodA4EVc------------------------------------------------------------------------
    I think I saw my son in the background........................................ ..........
    I guess we are getting old socal . . . back in our day, a prolonged dry spell could be cured with a VCR and some Hyapatia Lee . . . today's kids break the drought with CNBC and Melissa Lee.
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    Last edited by Sirius Roadkill; 11-01-2011 at 07:32 PM.

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    Spencer Conspiracy Theory # 974

    Looks like Savery is up to his old tricks again . . .

    Quote Originally Posted by Spencer Osborne View Post
    The company is now less transparent than they used to be in the subscriber metric. They no longer separate OEM and retail. I suspect that they simply do not want the street to see the break-out numbers due to their new retail units. My suspicion is that the retail numbers will not be as good as perhaps the street wants, thus, they are now hidden.
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    Last edited by Sirius Roadkill; 11-01-2011 at 07:35 PM.

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    Quote Originally Posted by Spencer Osborne View Post
    The street is looking for revenue to come in at about $764 million. I think that the street may be a bit aggressive here. Simply stated there was one time revenue last quarter that will not exist this quarter. I see the street expectations of $764 million to be at the high end of the range. Look for revenue to be between $750 million and $762 million with a safe bet at $756 million.
    Quote Originally Posted by Mel Karmazin View Post
    Although we're proud of our subscriber growth, our financial performance was even better. Revenue of $763 million was up 6% and represents a new record for a single quarter. Keep in mind that our pricing remains constrained at present. And as you know, we actually lowered the Music Royalty fee last December, which held back ARPU a bit. Despite the restraints on our pricing, we remain on track to grow our revenue by about 6% and hit our full year revenue guidance of approximately $3 billion. Importantly, the revenue constraint disappears in just 2 months.
    . . . . . . . . .
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    Last edited by Sirius Roadkill; 11-01-2011 at 08:01 PM.

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    Quote Originally Posted by Spencer Osborne View Post
    Look for $189,000,000.
    Quote Originally Posted by Mel Karmazin View Post
    The tight expense control and our revenue growth produced adjusted EBITDA of $197 million, up 16% year-over-year for the quarter. The adjusted EBITDA margin of 26% was also a new record high. In 2012, we expect adjusted EBITDA will climb to approximately $860 million. Our adjusted EBITDA guidance next year implies a full year 26% margin, up from an estimated 24% for the full year of 2011. We continue to believe that we will be able to achieve long-term margins in excess of 40% by scaling subscribers and revenue and holding the line on expenses.
    . . . . . . . . .
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    Last edited by Sirius Roadkill; 11-01-2011 at 08:06 PM.

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    Quote Originally Posted by Mel Karmazin View Post
    We just turned EBITDA positive 3 years ago, and we are very pleased where we have been able to move our margin at this stage of our development. Growing EBITDA is really a precursor to driving free cash flow, which we believe is the primary driver of SiriusXM's value. We are focused on growing our free cash flow substantially in the future. Free cash flow will enable us to invest in our business, which will increase growth, reward shareholders via dividends or share repurchases and make accretive acquisitions to improve the value of our company.

    In 2012, we plan to grow our cash generation to nearly $2 million every day. That's including weekends and holidays. Truly an astounding statistic, which will obviously represent the best free cash flow in the history of the company.

    Revenue growth is fantastic for investors, but it's best when combined with high incremental margins and tight expense controls. Our low incremental costs and focus on our fixed expenses will result in expanding EBITDA margins. And with our low requirement for capital expenditures and multi-billion-dollar tax shield, we plan to dramatically increase free cash flow over the coming years. Remember that over the next few years, we will have the opportunity to refinance some of our expensive legacy debt at lower rates. We will have many years without the need for substantial satellite capital expenditures, and with roughly $8 billion of NOLs, we have a substantial tax holiday. All of these things will help us grow free cash flow for many years to come. We intend to be good stewards of this cash flow.
    . . . . . . . .
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    Last edited by Sirius Roadkill; 11-01-2011 at 08:16 PM.

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    Quote Originally Posted by Spencer Osborne View Post
    Look for SAC to be between $58 and $60 on the build-out of retail radios and additional marketing expenses.
    Quote Originally Posted by David Frear View Post
    SAC per gross add continues its steady downward trend. At $55, it improved 6.8% over the prior year, largely offsetting the 9.5% growth in gross additions, contributing about half of the pickup in our EBITDA margin in the quarter.
    Looks like Spencer was schooled at the knee of that great mind David Bank!
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    Last edited by Sirius Roadkill; 11-01-2011 at 08:29 PM.

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    David Bank Speaks

    "Sirius just announced a price increase, and it's unclear how quickly it's going to roll through to the entire sub-base. They are also experimenting more with the used car market. So there are a lot of interesting developments there. I think the penetration is still low enough such that they probably have less macro risk. If you're one of the 20-million-some-odd subscribers to Sirius, you probably aren't going to churn because it's a choice of buying Sirius or buying food or gas or something. You're still a relative early adopter, and you're probably skewed more toward the middle or upper classes. I think we'll be looking at potential capital allocation there as the company starts to delever."

    David Bank, RBC Capital Markets
    http://www.twst.com/yagoo/davidbank1.html
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    Last edited by Sirius Roadkill; 11-02-2011 at 04:34 PM.

  8. #8
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    Quote Originally Posted by Sirius Roadkill View Post
    Looks like Spencer was schooled at the knee of that great mind David Bank!
    Is Spencer's price target still at 2.70 - 2.80 year end....or did he mean 1.70 - 1.80 ??

  9. #9
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    "Sirius XMís (NASDAQ:SIRI) stock hasnít recovered much since the S&P 500 dip in August 2011 due to concerns around the worsening economy in the U.S. and Europe. In October, the stock showed some signs of recovery, but dropped by more than 5% followed by the companyís earnings announcement on Tuesday as a result of lower than expected subscriber gains. We maintain our price estimate for Sirius XM at $2.11, implying a premium of close to 20% to the market price. We think that the business model for the company is intact, and that partnerships with big automotive companies such as GM (NYSE:GM) and Toyota (NYSE:TM) will go a long way."

    http://www.trefis.com/stock/siri/art...-11/2011-11-03
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    Insurance Post

    in case Spencer deletes my post on the main news page:

    Spencer says:
    November 4, 2011 at 2:43 pm
    Birdhouse….

    Okay,. I stole away a few minutes to give you a proper response.

    This article was not misleading at all. In fact, it gets to the heart of the matter with acual numbers.

    You see, while the churn rate may remain the same, the absolute numer is rising. It is the absolute numbers we need to deal with. I can make percentages say anything I want.

    Q2 2011

    Gross additions 2,179,348
    Churn – 1,727,201

    Q3 2011

    Gross additions 2,138,131
    Churn – 1,804,448

    You see what is happening here? Gross additions went down while churn went up. If you simply follow percentages you would would be missing that picture.

    next quarter churn will approach 1,900,000. With auto sales being weaker, and gross additions not growing as fast, it becomes very imp[ortant for Sirius XM to garner more gross subscribers. This can be accomplished by:

    1. More car sales – not likely
    2. Higher penetration rate – not likely
    3. A ramped up used car program – in the works
    4. Better retail – in the works

    Trefis is simply quoting Sirius XM and ignoring the fact that “retention” and “win-back” programs are code words for SELLING OUR PRODUCT CHEAPER. You will see that if you look at the ARPU line. Winning back subs is fine, but there is a cost to doing it.

    A take rate of 44.7% may seem impressive, but you need to remember that KEEPING subscribers is how the company makes money. 24% churn out each year. Winning 100 subs, but losing 85 is the reality. The sub growth is much more modest than people realize, and a dipping conversion rate makes that qynamic change greatly.

    In Q2 the situation was win 100 subs lose 80. Do you see the difference.

    What happens if we lose another half point on take rate combined with lower OEM sales and churn remaining stabnle at 1.9%? Think about that


    sirius roadkill says:
    November 4, 2011 at 7:34 pm
    “We are not seeing any change in conversion that concerns us about how customers feel about our product. Conversion of the same vehicle models are basically the same. What changes every quarter is the mix of OEMs and the mix within OEMs, as all models convert at different levels.”

    Mel Karmazin
    November 1, 2011
    http://money.msn.com/business-.....d=14465758

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