SiriusXM saw a mild walk up 4 cents on lower than average volume today. While this is not a run that instills a lot of confidence, the equity is setting up at decent levels. If, for some reason, we do not see a pre-call run, I think we will see one after the call. As I have stated, I am anticipating several records to be announced this quarter. Before getting into the technicals I will run through what I am anticipating in the call.
Before anything else, investors need to understand that the EPS year over year comparison will look very very bad. Last year the company posted an EPS of 48 cents per share. This was due to the booking of NOL's. Do not be scared if you see that last years number is 45 cents higher than this years number.
Analysts are looking for revenue of $934 million. This target is attainable, especially with the number of subscribers recently added. I am anticipating revenue to be a beat and come in at $938 million.
The tricky thing to calculate this quarter is the EPS. The reason that is tricky is because we do not yet know the share count due to buybacks. I am anticipating that the company can report 3 cents per share, which will beat the street by a penny.
I am looking for churn to be at 1.9%. A key metric to watch is ARPU. It has been drifting down. We want to see that stabilize. The new deal with BMW and Ford, that includes the higher priced "All Access" package should begin to work to reversing the downward trend. Watch for this.
I anticipate Record revenue, record free cash flow, record EBITDA, and of course the already announced record subscribers (gross additions and net additions will be records). I also expect the company to speak to a record number of satellite radio equipped cars on the road.
The low volume on an up day is not very bullish. It does not mean a reversal, but is not indicative of strength either. Essentially we are seeing continued consolidation. That is good. That consolidation is helping to make the support levels below stronger, and it also helps them move up. Watch volume leading into the call. If we see it spiking up, then we can anticipate a decent move prior to the call,
Support and resistance is looking better each day. We now have a moderate support level at $3.66, $3.60, and $3.50. This is setting up nicely, but it would be better to have support just a bit stronger.
The EMA's are back to all green. The gaps between each level are tightening up on the higher end, but the 50 day EMA is lagging just a bit. Look for added strength at the $3.60 level because it is also the 13 day EMA.
Support and Resistance
Exponential Moving Averages