As anticipated here on SiriusBuzz Sirius XM radio came out with a press release today on the Q3 reporting. The company will issue their quarterly report Monday, November 10, 2008, and will host a conference call the same day at 4:30 PM.
Perhaps more important than the guidance provided by Sirius XM Radio is the reason that the guidance was issued. The company states, “The company is in discussions with several financial institutions regarding a financing to replace its 2-1/2% Convertible Notes due 2009. In connection with these discussions, the company is releasing the material elements of its five-year operational and financial forecast.”
Refinancing of the debt has been a huge weight on the stock ever since the financial market collapse two months ago, and any news that a successful refinancing is happening could serve as a boost to the price per share.
Among the news was the release of guidance for the next five years.
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In the past Mel Karmazin has always maintained conservative guidance. Under Promise and Over Deliver has been the track record. Time will tell how aggressive or conservative this guidance is. There is little doubt that a weak OEM channel has had, and will have an impact on this company, as this is the method by which most subscribers are derived.
Position: Long SIRI