He's at it again, Sirius XM Radio (NASDAQ:SIRI) investors. Goldman Sachs analyst Mark Wienkes is talking down shares of the satellite radio provider, slapping Sirius XM with an embarrassing price target of $0.25 a share.

Wienkes hasn't endeared himself to Sirius XM shareholders, or at least those still sticking it out in the company. Those who heeded his apocalyptic warnings and bailed several months ago probably owe him a gift for the sharp losses they were spared.

Just don't make that gift a satellite receiver.

The worst part of believing in satellite radio is that Wienkes has been right all along. Sirius XM has difficult debt repayments due next year, and time is ticking. Even if Sirius is able to overcome the hurdles, it will probably be at the expense of massive dilution to a company that has billions of outstanding shares to begin with.

There are many challenges to satellite radio:

  • Smartphones like Apple's (NASDAQ:AAPL) iPhone can stream Internet radio.
  • Carmakers like Ford (NYSE:F) are installing CD-ripping hard drives into vehicle stereo systems.
  • Music subscription providers like Napster (NASDAQ:NAPS) and RealNetworks (NASDAQ:RNWK) are making their streams more accessible.
  • Internet radio heavies like Time Warner's (NYSE:TWX) AOL Music and CBS' (NYSE:CBS) Last.fm are reaching out to wireless phone users with free apps.¬†

These things aren't exact substitutes for satellite radio. Just ask any of the 18.6 million Sirius and XM subscribers. However, the real shame here is that Sirius XM's undoing -- if it comes to that next year -- is its own doing. Between a mountain of debt that is due in 2009 and the negative free cash flow from its current operations, every passing day makes it harder and harder for Sirius XM to avoid bankruptcy or deluging its shareholders with dilution.

Curses! Wienkes was right.

More news than static on Sirius XM: