Stifel Bullish – Goldman Cautions On Sirius XM
There were two reports issued by analysts today in response to the guidance issued by Sirius XM radio. Analyst Kit spring of Stifel noted that Sirius XM Radio’s guidance exceeds the Stifel model. This could be substantial in that there is at least some indication that sirius XM is being conservative in their numbers.
Spring notes that a stable churn is important, and if the company can maintain stability in churn, even in tough economic times, that it may help give some validity to the business model. Stifel’s spring is maintaining his BUY rating on Sirius XM with a price target of $1.25.
The second anlayst that issued a report today was Mark Wienkes of Goldman Sachs. Wienkes has been highly critical of Sirius X<. and in this report, little has changed.Wienkes noted that SIRI now estimates 2008 year end subscribers at 19.1 mn versus 19.5 mn previously and that he feels that number is sharply below the Goldman estimat of 19.6 19.6. Wienkes also notes that Sirius XM ended Q2 with 18.6 mn subs, and thus, the new guidance implies only about 500,000 net adds in all of 2H08 vs. 900,000 as previously forecast, and about one-quarter of the 1.95 mn added in 2H07. Wienkes gives no indication as to whether he thinks Sirius XM is being conservative or aggressive in their guidance.Rather than issue a new price target, Wienkes noted that the Goldman Sachs estimates and price target are under review.The report stated, "The lowered subscriber outlook reflects both the weak auto market and a higher saturation of natural demand for the product, in our view. We see more signs signaling further caution is prudent for any investor in satellite radio. Specifically, (1) Sirius’ lowered outlook; (2) a pending change in retail distribution partners (yesterday Directed Electronics announced the cessation of its Satellite Radio distribution deal as of 1/2009); (3) Time Warner Cable noted it was seeing a pull back in its premium service offerings; and (4) higher churn at DirecTV"Position - Long SIRI
Lets see what the worm weinke has to write after the CC.
Thanks, Tyler. Much appreciated.
How in the hell can the combined company only add 500,000 new subs in the whole second half of ’08? That seems way too low to me! They should be able to add way more than that in Q4 alone!
The combined company has added well over 1 million new subs in just the fourth quarter alone for 4 straight years in a row now!!!!!!!!!!!!!!!!!!!!!!!!!
Look at the subscriber charts in this thread………..
https://siriusbuzz.com/forum/showthread.php?t=905
@demian
I think they took in to account that this may be the worst Holiday season in 20 years, even tho, Electronics are the best selling item so far
Also the fact that churn may be slightly higher as people cut back on spending. I hope this is not the case.
Definitely churn. I have a few friends that cancelled their subscriptions due to other stuff similar to what Tyler reviewed recently.
NO — it is simple Math
When you have a very new product and people starting to buy, numbers can double every quarter, until you start to reach saturation of people interested in such product, then % increase begins to decline.
Look at AOL 15 years ago, when they had one milion, then 2, then 4 so on, now after 20 milions, that milion increase becomes only 5% and not 50% or 25% when their base was smaller.
Comcast, Direct TV are the same, they can’t increase more than 5-10% to their 20 million already subs
Hopefuly, they will have innovative retail products that can compete with IPOD. Then numbers can take off.
UNITED airlines have XM radio on board, if they can break a deal with other national and international airlines, that could be another revenue source
Demian…
I think you are right, the sub numbers seem out of line.
Sept. 2008 guidance for year sub count- 19.5
2009 guidance for year sub count- 21.5
Nov. 2008 guidance for year sub count- 19.1
2009 guidance for year sub count- 20.6
In less then two months, from Sept 9th 2008 to Nov.6th 2008, we get these new projections?
The Sept numbers were stright from Mel.
Does anyone know what the sub count was for month ending Oct 31st?
vaporgold
Demian..
Based on these numbers we will average 200,000 subs a month in 2009.
What does everyone think?
vaporgold
Demian,
1.5 million sub increase for 2009 = 125,000 net sub increase a month, not 200k
Mel just said a few weeks ago that sub numbers were still on target and that churn was still 1.6 to 1.8 percent. So how can they drop sub numbers a few weeks after that.
will Mel announce the number of actual subs in the CC? Myabe they were low balled in the projections?
Wienkes has an aggenda . . . Time Warner & Direct TV are not appropriate comps. What next? Price target of $0.125
So what, who cares? Wienkes becomes even more irrelevant in Feb ’09
Mark Wienkes . . . the worlds foremost authority on a 26 cent penny stock! Nice career.
Jon . . . you are right.
Mel said even as recently as last week or so in that “Autoline” infommercial where he “knocked-on-wood” for ’09 cashflow.
Go figure?
since wienkes thinks satrad is crap, someone stick a satellite receiver up his ass.
Roadkill, I hate this fuck Wienkes, however if he needed to put together a resume in the near future, his satelite radio coverage, record and predictions make him look like one of the best fucking anaylysts on Wall St! He may be a penny stock analyst but he’s been calling this shit from $6 right on down to a quarter!
wienkes is getting paid to bash us because he wants to run the price as low as he can to benefit GS and their holdings in siri and then they will go long with much more many shares to make a killing with.
Sirius Roadkill..Jon..SXM
The Autoline interview Oct 26th, just 11 days ago Mel indicated the sub numbers were fine due to higher penetration levels
33% penetration this year, and 50% penetration by the end of 2009.
He also went on to say that the re-fi and tight money was the major problem.
SXM…
That was my post you referred to on the 125,000 per month.
If you use the latest 19.1 2008 to 20.6 2009 it is as you stated 125,000 per month.
I don’t know who or what to belive anymore
vaporgold
they have 4,220,646 Added More 814,465
SirusHope, I know this theory, I’m just pointing out that we have all got it wrong for years and this fuck has got it right every time. It’s a tough sell to say he’s the moron. By the way when do you think their going long? Maybe Tuesday? Doubt it highly.
Kevin
IMO I think not until financing is announced…they will keep shorting and accumulating until then.
Kevin, you say, “He may be a penny stock analyst but he’s been calling this shit from $6 right on down to a quarter!”
Kind makes a suspicious mind wonder why….
Does any one know why GS still holding 5 million shares if Weinke thinks it is going BK
They added 814,465 for $952,924 on 8/14/08 when he had target of 0.50
I guess his colleagues did not read his predictions
Most of us are main street investors and the big dogs just allow us to be used to benefit them. They are master manipulators. But hold on and enjoy the ride they will be giving us soon once they go long.
Monday CC will be interesting.
vaporgold
We’ll see S-Hope. I’m just holding for now. Not going to make myself crazy trying to analyze this stock with so many unknowns between now at Feb. Either Q3 will be good or not; either Q4 ditto; either the shareholder meeting will change longs’ attitudes or it won’t; and either the Feb part of the ’09 debt will get handled in a positive way or it won’t. For all of the apparenty expertise of some of my fellow longs on this board, I think their just going to make themselves sick trying to second-guess SIRI. My high-level take is this is a long term (>1 year to <5 year) investment. I want to average down more but my instinct says keeping holding for now. I have enough shares to gain big on a turnaround. No need to get greedy. Just monitor, stay alert.
PM
great advice..we all must master greed, fear and patience…I am in for the duration…no matter how many years it takes…I am in for avg .97 pps.
This is a nice place to see what others think and feel. i know we all want the best and only can guess at this point what mon and thereafter will be.
And I should add, as I have before: I came in as a trader but turned investor. For a while afterward, as the stock tanked, I second guessed my decision and almost started trading again. Others’ strategies now are to go short and long the stock from trade to trade (intraday to swing level). I’m not doing that–for one thing because of the commission cost versus the actual profit at the current level. Plus each short-term trade triggers a taxable event. So, as I said, I’m just holding. I’ve made six buys and stand at 1.15 on average. I could do another buy at the current price at get down to about 90 cents. Want to, but see me post above. Instinct prevents me from buying until more is known. Also, extremely high short ratio says be cautious. I would really like to see the mother of all short squeezes–maybe one is coming….
PM
i sold last week 7600 @.36 and bought back 11,100 for the same amount invested therefore increasing share amount not value.
maybe if it goes up to .40 i will sell off again and wait for it to drop into the low 20’s again. will see after monday – wednesday what pps levels are.
seems this is the only way to build up share amount w/o losing additional value until it really pops in 2009.
Good Luck to all longs
at least now with avg pps at .97 i have a chance to break even sooner than later.
I am retired with a decent pension but i do work part time 2 days a week and use that money to gamble and add shares of siri.
Living in las vegas it beats going to the casinos.
Weikes claimed in March 07 that the merger was onlly 30% possible.
Without the Goldman debt holdings in Sirius, Weinkes would not look like a genius.
I can only hope Mel is able to remove GS from any debt holdings in the company
I just don’t know any-more on day’s the stock market tanks sometimes were up on day’s the market is up sometimes we are down, but the swings are significant, corporate money drives this stock! On one hand Sirius Is a threat to traditional radio, on the other hand corporate money usually doesn’t invest in to loosing propositions’, So, I am stuck between thinking total manipulation to make the company die because we are hated, but on the flip side total manipulation to scare off the retail investor into believing the company is going to die only to be a head-fake, so these greedy manipulative bastards (corporate- money) can have first dibs on the stock when it does soar leaving the retail consumer in the dust. Yes as a retail investor frustration is an under statement but everyday I turn on Sirius and everyday I see more car manufactures advertise XM Sirius, everyday I see a car with a portable Sirius radio. Everyday I wonder how can this company fail I guess I just have to wait and see. Position long
Hey Hope. I’m a big craps fan!!!!!!
we go up Fryday.
HEY SOCAL
Casinos weren’t built by winners.
The 19.1 may turn out to be a little conservative. Remember most thought the 19.5 estimate on the post labor day conference was conservative & some posters were calling for 20M easy.
The churn in 3Q must be pretty brutal along with car sales that are likely on an 11 million pace vs 12 being the worst estimates a few months back.
Not to mention the car companies are in such dire straights that their focus is on staying in business, not increasing penetration rates and advertising for DARS.
The consumer is tapped, credit is hard to come by for potential buyers, credit cards are going to implode next & layoffs will increase through middle of next year.
This economy is screwed big time, so you can’t blame Mel for thinking he lowballed the # at 19.5 2 months ago. Now he has better information and things are getting worse quicker.
I think Sirius will find a way to stave off bankruptcy, but 20 cents may be fair value until at least FEB convert $ secured. Then May is not far behind. I can’t wait to read the 10Q to see what the other future obligations of LTD are and what years they fall in.
This is a friggin mess and to see that they will not even make 30M subs and 5 Billion in sales by end of 2013 is sad, sad, sad, based on where are expectations were even when looking at companies on a seperate basis.
I hate to say it, but the negative analysts turned out to be correct.
With that said, finance Feb & May and it will likely get to at least $ 1 – again pathetic, but a start.
Kevin you might be the only person not huffing the ether. The blind optimism is on these threads has to make you laugh. All this talk about new subs, growth, better than expected churn….blah blah blah…its all shit. Can someone put down Crown Royal bottle for just a second? This stock blows! Wienkes is the man…Kevin said it right 6$ down to .25c. He hit this one to the moon! It has not even landed yet! Can anyone give me a reason why Mel should not take this company into bankruptcy? The can emerge with new contracts, wipe out the common, and start their way to profitability much sooner. For the record my 7770 shares are included in the common. I have followed this company from the Oct pre stern to now and lost my ass. The numbers being talked about are irrelevant; the stock price is the only thing that matters. Super Mel has let us down! Believe it! Until the reverse stock split is of the table buying shares is madness!
Big Ben cautiously long Siri, forever long Steelers!
Multi paged, colored ads in todays NY Post for Sirius with coupon for free 3 months when you sign up for best of both–Its about time they did something
Hey Ben,
It’s easy for Weinkes to be right when he has the GS backing to make his predictions come true. Mel will not take this co Bk because the unsophisticated shareholders are the subscribers. If a BK happens, they will lose millions of them. If Bk does not happen, then its only a matter of time before the short death grip releases and this baby pops. Siri has been a dissappointment but if they finance, they will be in the clear in a couple of years!!!
Hey Hope. Thanks for the info.
Wonder if they paid cash up front, or put the ads on account……………….lol.
ford is offering a 2 year package with some new models too
Hey Vapor,
Your still above that .25. lol.
Hope.
You enjoy tracking trading patterns.
My contention is that generally the highs for the day are made at the open.
But on Fridays generally there is some light short covering at the end of the day, that creates another boost towards the close.
Thoughts.
They offer a free 2 year subscription that is built into the selling price of the car to both lift car sales and to encourage people to try satellite radio. It is a huge win, win that will increase sales for the manufacturer and SIRI. This is a good move. Not a quick fix, but a nice step in the right direction. Way to go Ford.
so cal
i agree we opened up 03 lets see how the close goes..during the day it seems to flat line and stay up 02.5 – 02.7
yesterday there was over 10 mil shares traded the 1st hour…today seems slower
Krypto
What’s your take on yesterday’s guidance from Sirius. Thanks
Hope. I agree. Slower trading. Not necessarily bad as we seem to be trading with the dow today.
Have seen those days before like this. It’s a rare day where we trade with the dow. The shorts are unsure of the days bias, leaving them to simply watch until news.
The Obama summit and press conference at 11:30 will perhaps move the markets.
yesterday there was a rumor regarding taxing 401k’s under the new administration, that hurt the markets overall.
Hopefully today the mtg will be viewed as positive.
In my opinion. The media created Obama. And is setting his administration up. to save the country and the world.
I could care less as long as it get us out of this nightmare economy.