Recs

43

And the Sirius XM Fans Keep On Coming

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

The first quarter was another magnetic period for Sirius XM Radio (Nasdaq: SIRI  ) .

The satellite-radio operator added 171,441 net subscribers during the first three months of the year. That marks the third consecutive quarter of sequential subscriber growth at Sirius XM, after it had kicked off 2009 with back-to-back declines.

With more than 18.9 million subscribers, Sirius XM is just shy of its all-time high established five quarters ago. The recession took a bite out of the media giant's sails, but several quarters of healthy auto sales have done wonders for the premium offering.

Ford (NYSE: F  ) car sales have been strong for several months now, and even the beleaguered Toyota (NYSE: TM  ) has bounced back. These trends bode well for Sirius XM's future, and the company's earlier guidance for 500,000 net new subscribers in 2010 appears to be conservative.

There's more to the good news than strong auto sales, though. Those who are buying cars with factory-installed receivers are sticking around. Self-pay churn and conversion rates are better now than they were a year ago.

Sirius XM won't be reporting its quarterly results until next month. It's simply delivering a bit of the good news early, just as it did three months ago.

Putting out the encouraging numbers early is a good move. It meets with Nasdaq OMX Group (Nasdaq: NDAQ  ) later this month to appeal its pending exchange delisting. With the upbeat numbers propelling Sirius XM's stock over the $1 mark, if it's able to close with a bid of $1 or higher over the next 10 trading days, it can just send a cardboard cutout of CEO Mel Karmazin to the April 29 meeting, because it will already be in compliance.

Sirius XM has tacked on more than 530,000 net subscribers over the past nine months. Karmazin has cut costs at the merged company, enhancing the bottom-line power of every incremental listener.

Are there threats to the model? Sure. Many of the most popular programs through Apple's App Store are free music-streaming services. Sierra Wireless' (Nasdaq: SWIR  ) Overdrive mobile hot spot can spit out streams at 4G speeds on the road. However, the same improving discretionary income that will drive sales of smartphones and mobile broadband connections will also justify the reasonably priced Sirius and XM subscriptions.

It's a good time to be Sirius XM Radio.

Will today's news be enough to keep Sirius XM above the $1 mark this time? Share your thoughts in the comments box below.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Nasdaq OMX Group is a Motley Fool Inside Value selection. Apple and Ford Motor are Motley Fool Stock Advisor recommendations. Motley Fool Options has recommended a write covered calls position on Nasdaq OMX Group. Try any of our Foolish newsletter services free for 30 days.

Longtime Fool contributor Rick Munarriz is a subscriber to both Sirius and XM. He owns no shares in any of the companies in this story and is also a member of the Rule Breakers analytical team, seeking out the next great growth stock early in its defiance. The Fool has a disclosure policy.


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 April 14, 2010, at 4:23 PM, southernbeachguy wrote:

    Sirus is so much more superior product than anything else out there. If you try it once you will never go back to terrestrial radio. The Stock is also still undervalued. Sirus has the capability of going Worldwide and if they do their Revenue could go up 10 fold. Also, as older clunkers gets junked, more Sirus Radios will come in their replacement cars. Lastly, after someone tries Sirus in their Car, they want it for their Home or Office..... especially during Football season.

  • Report this Comment On April 14, 2010, at 6:15 PM, Drakon1976 wrote:

    THE SHORTS ARE BEING CRUSHED ON SIRIUS!!!!!!!!!!!!! ALL THAT GARBAGE YOU SPEW RICK IS MAKING ME RICH!!!!! MAYBE IF I CAN MAKE ANOTHER 500K ON THIS I'LL NAME MY FIRST BORN RICK IN YOUR HONOR! WHERE IS SIRIDOOM THESE DAYS?

  • Report this Comment On April 14, 2010, at 6:43 PM, mountain8 wrote:

    Garbage?????????

  • Report this Comment On April 14, 2010, at 6:48 PM, PSU69 wrote:

    I had SIRI retrofitted in my Porsche and I love it. I believe the long dark tunnel of OEM car building is over now and SIRI will sail north of $5 during the next 2 years. Many of us who bought as the stock slipped lower and lower and lower will end up with very large smiles on our faces. Indeed, I have sold some due to the huge gains.

  • Report this Comment On April 14, 2010, at 10:27 PM, webjawns wrote:

    Sirius is a great product, but I think a lot of potential customers haven't experienced it to be able to realize its value. Although I don't believe it should be a sole focus, I think Sirius should explore avenues similar to Pandora and Rhapsody - if only to draw customers closer to the company, so that they can sell satellite radio for the car, office, etc.

    Since I got subscription to Sirius a few years back, I've gotten quite a few people to sign up. Most of which did not realize exactly what was on there.

    I wholeheartedly believe that with the budgetary changes Sirius has been making, coupled with a recovering auto industry/economy, and the overall great product they have, Sirius will prove to be an amazing long-term investment. Time shall tell...

  • Report this Comment On April 15, 2010, at 7:00 AM, rouben45 wrote:

    Excellent article,

    I am an investor and long in SIRI, I believe in this stock because:

    - SIRIUS have very limited competition

    - They have fantastic product

    - It has become a household name , like Tide, Coca Cola , Pepsi etc.

    - The car companies are the best sales avenue for Sirius and they are rebounding. Look at Ford which has made the American public proud of their car Industry , like it used to be the case in the sixties.

    - Latest earnings point to the direction of profitability. In fact the good news in SIRI number accelerates quarter by quarter.

    De listing is not an option for NASDAQ. SIRI can move to NYSE and get even higher respectability. I have no problem with RS, in fact it could be beneficial to SIRI investors.

    - Short sellers will always be there, however , they will soon give up because on SIRI and move somewhere else, it is an empirical fact the SIRI is improving . It is like betting 000 on a roulette wheel. One has to be stupid because the wheel has no 000.

    -I will keep increasing my position. SIRI , I predict the stock will close over 2.50$ by October 2010. Mark my word.

    From Brussels Belgium

    Good luck and good day.

  • Report this Comment On April 15, 2010, at 10:30 AM, Streamlined10 wrote:

    I see the Sirius Long's cult has already commented. Sirius longs have to be the most optomistic psycho people on the planet. You all need a convention so you can chant and yell and be cultish in one place.

    Anyway, I am a SIRI long investor because I can make money on the stock. As for the product, I'm not a fan. I had SIRI for 2 years in my car and got REALLY tired of the same music over and over like it was on a loop. The music channels were weak and Howard wasn't worth $13 a month so I cancelled. In return, I am now using my Ipod, where for $13 a month, I can get 13 of the songs I want, and can create a play list that I choose not one that is played for me. Unless you are a trucker that is addicted to sports or Howard, I still don't know how this product stays afloat but I will continue to make money on it as long as people believe in it.

  • Report this Comment On April 15, 2010, at 1:20 PM, Lamley2 wrote:

    I disagree with the previous post. I tried using an iPod, but the dirty little secret is how much trouble it is to deal with. It has to be loaded up and set up and compared to other options, it's not very user friendly. Not only that, with Sirius I can get exposed to new music I wouldn't otherwise know about, since I'm not stuck in my little iPod cocoon. I'm busy. I work and am tired when I leave work. I know about what kind of music I like and I can just punch a single button on my Sirius and get great songs, commercial free, and a few of which are good songs I never knew about before. With an iPod you have to load in songs and most people aren't going to just load in unknown songs. Sirius is so convenient. There are also many, many talk shows, news channels, financial channels, traffic channels, and so forth that I find entertaining and informative as well. iPod? Been there, done that.

  • Report this Comment On April 15, 2010, at 1:31 PM, Br0oklyn wrote:

    < Long Term Hold On My Company. I Got Faith. And Rouben Couldnt say it any better.

  • Report this Comment On April 15, 2010, at 1:55 PM, JVMFan wrote:

    Investors that bought Sirius XM one year ago have seen a 2000 percent increase in their stock. The whole story is told in a new movie about Sirius XM and the stock market called "Stock Shock." DVD is cheaper at www.stockshockmovie.com, but the DVD is pretty much everywhere for sale.

Add your comment.

Compare Brokers

Fool Disclosure

DocumentId: 1153231, ~/Articles/ArticleHandler.aspx, 5/27/2012 7:26:07 AM

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 12,454.83 -74.92 -0.60%
S&P 500 1,317.82 -2.86 -0.22%
NASD 2,837.53 -1.85 -0.07%

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

5/25/2012 4:00 PM
SIRI $1.93 Down -0.06 -3.02%
Sirius XM Radio CAPS Rating: **
SWIR $8.46 Up +0.11 +1.32%
Sierra Wireless, I… CAPS Rating: ****
TM $76.80 Down -0.40 -0.52%
Toyota Motor Corp… CAPS Rating: ****
F $10.60 Up +0.01 +0.09%
Ford CAPS Rating: ****
NDAQ $22.06 Up +0.26 +1.19%
Nasdaq Stock Marke… CAPS Rating: ****

Advertisement