I am off to California for a couple of days, and am looking forward to Mel Karmazin's speech at the Merrill Lynch Media conference. It seems that many investors, analysts and sector followers are awaiting this conference with great anticipation and expectations. After all, it is the first time since Labor Day that Mel Karmazin will be making a speech, and everyone has been eager to see where the company now stands a bit over a month after FCC approval was granted.
With regard to tomorrow's speech, from an equity perspective, I am going into it with reasonable expectations with room for surprise. I think it possible that enough time has passed for the Sirius XM Radio CEO to give some merger flavor, as well as guidance. I feel that some plans for consumers will be outlined, and that we will begin to see the merged company taking shape.
In actuality, I am looking at the speech tomorrow as more of a launch pad for additional information. Let's not forget that this is not only a satellite radio conference. This is an overall media conference, and using it as a forum for several major PR announcements would not seem to fit with the style of conference at hand. Instead, I look for new information that will likely be generalized, and used as a platform for additional Press Releases and announcements over the coming weeks. It will be the Sirius XM Press Releases that contain the details.
While at the conference, I would anticipate that the Sirius XM team would make themselves available to answer analyst questions regarding everything from financials to projections, to how various metrics will be accounted for by the merged company. In time, these analysts will begin to issue new reports regarding the company. The end of the third quarter is fast approaching, and now is the time that analysts will need to change their models. The balance of September should be interesting.
Thus, I feel it important that sector followers listen to the speech, but temper enthusiasm for announcements with the realization that this conference is not a Sirius XM Radio conference, but rather a general media conference.
Position - Long SIRI