The End of SIRI and XMSR
After watching the action of the stock price for the last 2 days, I’m convinced the manipulation of SIRI and XMSR will continue unfettered despite SIRI being listed on the Regulation SHO Threshold List for the last 3 weeks. It’s apparent that threats of naked shorting crackdowns by the Securities and Exchange Commission are having little effect on Sirius; except to the extent that the manipulators are avoiding bank stocks and have seemingly turned their attention to a couple of non-essential securities like Sirius and Xm.
So what can be done about this? If the SEC will not protect the shareholders of Sirius, perhaps its time that the company did. I would suggest that with the merger details being ironed out, it may be time for Sirius to consider changing its symbol to more reflect the merged entity, possibly to SIRX or the like. The symbol wouldn’t matter, as long as it is not SIRI.
I used to work for Dean Witter, which was one of the biggest and most respected brokerage firms in the nation. When we merged with Morgan Stanley, the symbol changed from DW to MWD. Morgan Stanley now trades as MS. Old timers may recall that Sirius was originally named CD Radio Inc., and traded under the symbol CDRD.
I sincerely hope the company is considering a ticker change. The benefits of a fresh start would be a welcome change. For starters all program trades would be rendered useless. All high limit and stop loss orders would need to be reentered. The market would be free to redetermine the value of the merged company.
As I stated in my last article, the best outcome for shareholders would be a Friday after-hours announcement of approval. Not only would this give the company an extra day to consummate the deal, it would castrate the NAB, which I’m sure is parked outside of a D.C. courthouse right this moment with filings in hand. By Monday morning, the deal would be complete and unstoppable.
Looking ahead to Monday however, and assuming all of this happens, we would probably see Sirius bid higher. Program sell orders would then take effect and begin to knock the price per share back down precipitously as we have seen done since yesterday when the stock opened at 2.75. A new symbol would prevent this and allow the market to revalue the combined company, in a fair and balanced way.
Position: Long Sirius, XM.
Brandon,
Excellent post. You left out the castration of the shorts if approved over the weekend. I think you will see short covering late today. Only a fool would hold a short position in both stocks over the weekend, unless, of course, you can completely control both stocks…manipulation.
We could hope for a short squeeze once the final vote is cast and the merger is 100% for sure. I think there is still doubt in investor’s minds as to whether or not the merger is going to happen because of the length of the process and the numerous speculative let downs on the when the merger was to be completed. Once there is no more doubt there should be a decent pop in the price which will hopefully force shorts to close their positions and when that time comes there may not be enough shares for them to purchase or they’ll have to pay a premium. So hopefully they’ll get it in the end. I think shorting has a purpose and clearly it shouldn’t be used for manipulation and unfortunately with SIRI the demand on the buy side isn’t there yet to keep this from happening.
Maybe the SEC could JUST DO THEIR DAMMM JOB????
What would help more than a symbol change would be a reverse split. Fewer shares would lead to less manipulation. More importantly, many funds will not touch stocks under $5.00
I want to see SIXM
When a stock trades below $3.00 a share..you have way to many soft owners….its a joke. In my opinion after the merger Mel does a reverse split probably 1 to 5. This will benefit everyone. There are way way to many shareholder with 100 shares…
So then there will be a lot of holders with 20 shares? That makes sense. A reverse split is only good for the accountability of shares.
The stock price doesn’t seem to matter that much even XMSR is down since the announcement.
Stocks that people want, don’t go down. As long as these are penny stocks, they will trade like penny stocks. With Siri having 1.5 Billion shares @ 2.25 it’s as worthless as dirt for trading.
Is SIXM twice as good as MMM? Ok, that was lame…
Reverse stock split is a short term fix like changing the symbol-it will help over the next two months-the Mel machine has to fire up and explain to people what is going to happen. He has to articulate the cost savings better, he has to give projected numbers for Sat TV, mobile phones and cars. To scare off the shorts more-he has to maybe announce something big with a google, msft, etc……..that is how you can go north from $2.25……..
don’t you think the fcc has singled handed assisted the short sellers in destroying these two companies and were paid to do so by caving in to terrestrial radio. Someone in charge I guess theDOJ should investigate this entire fiasco….Somebody’s on the take and we have a right to know. These same people had no problem allowing two megas in the oil world merge…
Change the ticker to “FCC”.
“FCC” ….now that would be funny!
I just got a Professoinally developed portfolio delivered by UPS from my broker, Charles Schwab, asking me to ‘loan’ them my Sirius stock. Nowhere in it does it mention thet they want the shares so they can be shorted in order to drive the stock oprice down. F U Charles Schwab.