Sirius Weekly Thread for April 26

[john]

I figured Big Ben would be around now that the market finally retraced a little. He'll be here shortly because I think today will be red as well. We'll see.

May 4 is the official date. Four trading days. What shall these sessions bring to SIRI? That's a million dollar question. Does it run up? Now that the 10 day pressure is off, do we see some selling? BM is already predicting stellar results; though what defines stellar? For me, that's 10 cents EPS!!

Well I know why S&P analyst, Tuna Amobi thought it was on the 6th instead of the 4th. It was supposed to be on the 6th but SIRIXM pushed the date up.

I think you will be waiting a few years for that remember one penny a share is alot with, what is it 3.6 billion shares out there (not including the Liberty stake). As for BM, if it were not so obvious, I would not believe him on anything at this point. I think if we dont get some kind of run up then there will not only not be a pull back but just maybe (and that is a big "just maybe") a trend higher after the CC this time. I am still waiting to see what the April OEM run rate is, to say for sure though.

[Havakasha]

"10 cent EPS"? Always love your sense of humor S&L ()

[SiriuslyLong]

"10 cent EPS"? Always love your sense of humor S&L ()

Hey, that's my definition of "stellar"! According to some, SIRI will be lucky to be in the black.

[Havakasha]

Hey, that's my definition of "stellar"! According to some, SIRI will be lucky to be in the black.

I know thats YOUR defintion. I quess i thought it was way high. 10 cents sounds stratospheric not stellar, but i quess we all might have different defintions of stellar. Do you have an expectation that SXM will hit that 10 cents mark? If so when? Just curious.
I do know we are fighting to be in the black.

[SiriuslyLong]

I know thats YOUR defintion. I quess i thought it was way high. 10 cents sounds stratospheric not stellar, but i quess we all might have different defintions of stellar. When do you expect SXM to hit that 10 cents mark?
Just curious.

First off, I think they'll have to get some shares off the market in some fashion. With 3.6 B shares outstanding, they would have to clear $360 MM (last quarter $14.2 MM on total revenue of $676 MM and total operating expenses of $596 MM according to google finance).

Without the R/S, the question then becomes how does one get from a net income of $14.2 MM to $360 MM? Mel made a statement last quarter that every new sub is 70 cents to the bottom line. (360 - 14.2)/.7 = damn near a half billion subs - that ain't happening.

Can they cut their expenses in half? Doubtful.

Can they get there by doing a little of each? Still doubtful.

The only way is to get shares off the market. That's my sophmoric take.

[SiriuslyLong]

um, hello there............

SIRI announced retiring a bond, and .... I'm the last jackass to post at 3:45 PM.

Good stuff SIRI holders. Good stuff.

[john]

First off, I think they'll have to get some shares off the market in some fashion. With 3.6 B shares outstanding, they would have to clear $360 MM (last quarter $14.2 MM on total revenue of $676 MM and total operating expenses of $596 MM according to google finance).

Without the R/S, the question then becomes how does one get from a net income of $14.2 MM to $360 MM? Mel made a statement last quarter that every new sub is 70 cents to the bottom line. (360 - 14.2)/.7 = damn near a half billion subs - that ain't happening.

Can they cut their expenses in half? Doubtful.

Can they get there by doing a little of each? Still doubtful.

The only way is to get shares off the market. That's my sophmoric take.

Hey you dam twit, I have some good news for you. It is .70 PER DOLLAR and NOT per subscriber.

Now dont you feel a little better.

I do agree that the only way to get that 10 cents you were talking about is to buy back shares and then retire them. The problem is they will not be in any position to do that for at least 4 to 5 years. You know they have over 3 billion in debt and will want to take care of most of that (lets say at least 2.3 billion) before they can think about buying shares back that interest they are paying, by it self is another drag on the GAAP positive. Look even Mel says they will be earning about what 500 million in FCF a year, in something like 2013 (or 2014?) so given that and the debt they have it will be some time before they can buy shares back and most likely not until 2016 or 2017 before they could even make any sizable dent in the share count.


Just some common sense and logic with some simple math thrown in for good measure.

[SSG]

The company is prohibited from buying back share until they are a profitable concern. Even when that happens they have other housekeeping to deal with first.

[SiriuslyLong]

Hey you dam twit, I have some good news for you. It is .70 PER DOLLAR and NOT per subscriber.

Now dont you feel a little better.

Just some common sense and logic with some simple math thrown in for good measure.

Oops. Assume the average sub is $10 of which $7 goes to the bottom line, and you need damn near 50 MM new subs to get there (just a decimal place off - give me a break lol). That does make me feel a little better, but it's still astronomical to think that SIRI could have 65 - 70 MM total subs.

Trouble is that if SIRI is going to have this massive amount of shares outstanding for 4 - 5 years as suggested, then we can probably count on single digit EPS for 4 - 5 years, no? Oh, that's gonna attract a lot of investors LOL.

[SiriMonkey]

Good morning

A reminder to tune in tonight Sirius Buzz Radio at 9:00pm. Link is on
the News page.
Last weeks show after a long hiatus, was great. The hour
flew by. Lots to discuss tonight.

Julie