Sirius XM Holdings (SIRI -0.94%) is gearing up for a big earnings announcement this week. The satellite radio provider reports first-quarter results before Wednesday's market open, and a lot is riding on its financial performance. Sirius XM has been one of the market's biggest winners since bottoming out at $0.05 -- yes, a nickel -- in 2009. The stock is now a 127-bagger, and it hit a new 12-year high just last month.

Satellite radio doesn't get the same kind of buzz that we see for streaming entertainment, and that's not a bad thing. Sirius XM is now a slow yet steady grower on the top line. It's consistently profitable. It shells out a quarterly dividend. Even naysayers are moving to the sidelines, as Sirius XM is seeing its lowest number of shares sold short in more than a year. It seems to be smooth sailing for Sirius XM, but you know what they say about the quiet before the storm. Let's go over a few things that can rock Sirius XM's boat this week. 

Dolly Parton at a Sirius XM Town Hall interview.

Image source: Sirius XM Holdings.

1. Comparisons to Spotify may prove unkind

It was easy to compete for investor affection when the only other major music platform out there was Pandora (P), and Sirius XM already owns a 19% stake in Pandora. However, Sirius XM is no longer the belle at the ball. The faster-growing Spotify (SPOT -3.31%) went public three weeks ago, and it reports its first financial results as a public company a week after Sirius XM does.

Spotify is growing a lot faster than Sirius XM or Pandora. Analysts expect the on-demand leader with 71 million premium subscribers worldwide will clock in with a 27% spike in revenue for all of 2018. Sirius XM's guidance calls for a more pedestrian 5% uptick, while analysts estimate Pandora will grow at a mere 3% clip. 

It's a mistake to think that a stock trades entirely on its own merits. If investors are chasing a shinier object, it could could result in shrinking multiples for the less exciting rival.

2. Guidance will have to be raised

Sirius XM traditionally puts out a weak full-year outlook that it nudges higher as the year plays out, but its guidance last time out left a lot to be desired. The $5.7 billion in revenue that Sirius XM is targeting is just 5% higher than last year's haul. Things get worse as we work our way down through the forecast numbers, with just 2% growth in adjusted EBITDA and a slight decline in free cash flow.

Investors could be in a world of hurt if Sirius XM doesn't crank out blowout subscriber numbers or at least materially lift other components of its guidance. The stock's direction on Wednesday will be largely dictated by the earnings outlook. 

3. Decelerating growth may turn off investors

Sirius XM investors know the score when it comes to Sirius XM growth. They've seen revenue grow by no less than 8% and no more than 13% in each of the past six years. Despite the ho-hum top-line gains, the stock has moved higher every year, easily beating the market over the entire six-year span. 

Investors will need to temper their expectations this year. Sirius XM's guidance is calling for 5% growth this year, and analysts are holding out for just 6% in revenue growth for the first quarter. With Spotify already grabbing the growth baton, Sirius XM will need to prove that growth won't continue to decelerate with every passing year at this point.