In My Humble Opinion
Now that Sirius XM has laid out its cards on the table, I’d like to offer my view. I’m surprised at all the surprise and negativity from these other analysts. I mean, they have to be kidding, right?
On the reverse split issue, allow me to paint myself into a corner and applaud the company. It’s about time they got proactive in defending the stock price! This should have been done years ago. One of the biggest problems for Sirius XM over the past several years is that it has had far too many shares outstanding. Such a large number of shares combined with a sub 5.00 stock price has made manipulation too easy. The number of outstanding shares alone validates its reversal.
Have you seen the stock price lately? Dilution has been factored into it already. Several analyst reports that I have read this quarter have planned on it. They may have expected it in February, but what’s the difference at this point? So go ahead, trade the 35 cent shares for debt, then do a 50 for 1 reverse split. As a shareholder, I’d rather see the company trying to protect my investment rather than sit back and watch it evaporate further.
On the issue of the debt for shares “surprise,” I am just as excited about this as I am a reverse split. I thought Wall Street analysts were supposed to be smart! I can easily recall Mel Karmazin’s recent statements, that Sirius XM would be very close to being in a position in February, to pay off its debt with CASH ON HAND. My thinking is that the 30 million dollars raised will make that Feb 2009 debt retirement completely plausible. This is the single best sign of the future of Sirius XM that I have seen in many years.
The markets want visibility and it plans up to 18 months ahead. The market right now cannot see past February when it comes to Satellite radio. Many analysts have speculated about a potential restructuring at that time that could wipe out shareholders. Up until now, the company has been silent. These signs are the first real indication of its intentions to avoid bankruptcy and to reduce its debt. This is not just talk. Who, for instance, would accept 30 million dollars in common stock in exchange for repayable debt if bankruptcy were even a remote possibility? NO ONE!
The only reason to enter into such a deal is the belief that the equity has more value than not only the bond interest, but its principle. That is good news, no matter how you look at it, for shareholders.
Position: Long SIRI
amibankrupt. LMAO!!!!!!!!!!!!
I would donate 5,000 – 10,000 to the company in a heartbeat…. If Tyler decided to pitch the idea, it would be pretty far out in left field, but it could work… there are a lot of motivated share holders. I do not think that they will need it, with some growth, seroius cost slashing, and some luck, they will get it done. You are not seeing advertising right now because they have made a serious effort to stop the bleeding. A campaign will kick in when the survival of the company gets handled.
I am sick of the conspiracy bullshit. Karmazin talking right now in any specificity would be a bad,bad move.He should rip cost out of the company 100 mph and let the metrics talk… the metrics will drive a change in pps, and enable the company to refinance. We need a Q three call from Mel that highlights the move to breakeven, not rosey future potential stuff. We all know the potential is there, that is why we are here, and why we should stay in.
I actually dread the thought of ever having to listen to terrestrial radio again, or anything that remotely resembles it. I hope that Sirius/XM managment is listening to the subscribers; WE DONT WANT ANOTHER VERSION OF AM/FM !!! I hope that the company can survive, as it would be shame if a service with so much potential, with a core group of loyal, passionate listeners, simply fades off into the sunset. The absolutely absurd merger delay, which was disgraceful if not downright criminal ( on Bush’s watch, naturally ), put this company at a huge disadvatage. I still believe that satellite radio is relevant, but I am also aware that we live in a junk culture where people have very short attention spans and everybody wants instant gratification…… and results. If you stick an I-pod and a satellite radio in front of me and ask me to choose one, I am going to take the radio everytime. I am part of the “niche” that understands how great satellite radio is, and how it could be even better. It seems that the general public has an insatiable appetite for anything that is mediocre. Lastly, I just wonder what the real intentions of Mel and Co. actually are. If they want the company to survive, I believe they can make it happen. For Christ’s sake, the subscribers and shareholders are even offering to help out if it means the salvation of satellite radio. This is from people who have lost their shirts – and most of their money. I am one of them. Come on you guys; show the subscribers and the investers at least a little respect. If that is too much to ask, then maybe a smidgen of guidance would be nice!
Steve …
It is just beyond amazing that since Mel’s great loan at the merger, his remarks of having to lend the company money which sent the stock spiraling, his comments about taking it public, which sent the stock spiraling,and he nearly has finished this company off with his release of of 50 to 1 stock reversal’s and wanting to print another 3.5 billion shares.
Bid this morning was at .20 ask .21
He has done NOTHING to try and even shore up the stock price.
Join the lawsuit is all I can say.
imho
vaporgold
Bill and Kevin…if you guys think they should ask each shareholder for 500 bucks, you should take your money and buy more shares instead. I am not giving these guys one penny more to waste away.
Mike – Longer than I wish I was at this point