Everyone's Starting to Believe in Sirius XM

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

A few years ago, Sirius XM Radio (NASDAQ: SIRI  ) was the butt of investing jokes.

No one's laughing anymore.

Shares of the satellite radio provider hit a fresh five-year high of $3.85 today. Even with the media darling's ambitious share repurchase efforts, Sirius XM has never been more valuable than it is right now.

These are the kind of lofty heights that would woo naysayers, but they're surprisingly silent, too.

Exchange data released on Friday shows that Sirius XM had 303.2 million shares sold short. That's a big number -- and it is -- but it's actually the lowest tally since November of last year. Short interest peaked at 414 million at the end of February.

The ideal mix of buoyant car sales and an improving economy has been working wonders for Sirius XM. It has tacked on nearly 1.2 million net additions through the first half of the year, and the average subscriber is paying more than before as last year's price increase kicks in. Boosting the value of its premium streaming add-on platform is also helping.

There was always the fear that Liberty Media (NASDAQ: LMCA  ) would spin off or unload its stake in Sirius XM after achieving its controlling interest, but that's a rarely voiced concern these days. Sirius XM is a workhorse. Why would Liberty Media want to stop riding?

It also only helps Sirius XM that it keeps growing its subscriber base in a seemingly changing marketplace. Pandora (NYSE: P  ) continues to grow at a faster clip than Sirius XM -- and streaming apps continue to pop up -- but Sirius XM just keeps adding to its rolls.

If anything, one might even argue that Sirius XM and premium streaming services including Spotify and Pandora One have whetted musical appetites of the middle class and better. Radio is more valuable now than it was in the terrestrial radio gravy days where playlists were narrow and limited by ad blocks.

Sirius XM may never accelerate its growth to the levels that we're seeing in some of the online names, but as it tests its pricing elasticity on a growing base of radio buffs, it's hard to call for a ceiling.

Sirius XM is at a five-year right now, and it won't be a surprise to be there again before too long.

Sirius XM hasn't been the only way to retire rich
The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "
3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Read/Post Comments (3) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 12, 2013, at 11:40 PM, scbryant5150 wrote:

    Great article and even better news on Siri. We should be thanking the power of Howard Stern for catapulting subscriptions. Thanks, Howard!

  • Report this Comment On August 13, 2013, at 11:10 AM, JamesRobertDobbs wrote:

    I seriously doubt that Howard Stern is adding a significant number of subscribers. He did in the past, but I'm guessing that most of them subscribed to Sirius a while back, or decided they'd get him elsewhere. He's old news at this point, in spite of his stint on "America's Got Talent."

    Most likely the most significant factor in the growing number of subscribers is simply due to the increasing number of new (and now, pre-owned) cars containing a Sirius radio.

  • Report this Comment On August 13, 2013, at 12:50 PM, jojopuppyfish wrote:

    As a long time howard stern fan, I'm amazed they keep adding subscribers. He's on 3 days a week......sometimes. He sounds like he doesn't care most of the time.

    When he leaves, Sirius will take a hit, but it wont be more than 3 million subscribers

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2592023, ~/Articles/ArticleHandler.aspx, 9/24/2016 11:53:00 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,261.45 -131.01 -0.71%
S&P 500 2,164.69 -12.49 -0.57%
NASD 5,305.75 -33.78 -0.63%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/23/2016 4:00 PM
SIRI $4.21 Down +0.00 +0.00%
Sirius XM Radio CAPS Rating: **
P $14.09 Up +0.08 +0.57%
Pandora Media CAPS Rating: **