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This Week in Sirius XM Radio

By Rick Munarriz – Mar 8, 2014 at 3:45AM

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There's never a dull week with Sirius XM Radio.

Things never get dull for the country's lone satellite-radio provider. Shares of Sirius XM Radio (SIRI 0.25%) closed at $3.51, down 2.8% on the week. The media darling's slide was trumped by Nasdaq's 0.7% uptick on the week.

There was more going on beyond the share-price gyrations, though. Apple (AAPL 1.56%) introduced CarPlay, making it easier for drivers to access its audio entertainment offerings. JANA Partners initiated a stake in Sirius XM. And on the streaming front, MKM Partners upgraded Pandora (P)

Let's take a closer look.

Apple wants the driver's seat
Apple's next battlefield may be the dashboard. The consumer-tech giant introduced CarPlay on Monday, a platform that will make it easier for iPhone owners to use Siri -- and we're not talking about Sirius XM's ticker symbol -- to access information and audio entertainment from their car speakers. 

The ability to check voicemails, make calls, and use Apple Maps to navigate around may not be such a big deal to Sirius XM. Many automakers already offer similar, if not better, platforms. However, CarPlay also makes it easier to stream Internet radio and podcasts as well as dive into an iPhone's stored tracks. 

Sirius XM has been able to grow its self-pay subscriber base despite innovations in the area of in-car entertainment. It also bears pointing out that accessing streaming apps isn't as free as one might think unless they happen to have unlimited data plans. However, Apple's entrance into this market can't be ignored. It tends to attract attention, and that explains why Mercedes-Benz, Volvo, and Ferrari have already implemented CarPlay with most of the other car titans on board to roll CarPlay out in the future.

Hungry hungry institutions
JANA Partners didn't merely dip into Sirius XM recently. The hedge fund initiated a position in the satellite-radio monopoly with a whopping 50 million shares. JANA is buying at an interesting time, and it's likely banking on having Liberty Media (FWONA) sweeten its offer to acquire the remaining nearly 49% stake it doesn't currently own.

Only non-Liberty Media shares will be voting on the deal, so JANA could be trying to stack the deck in its own favor. But it's not enough ammo to shoot the deal down. It's not that 50 million shares aren't a lot, but it's less than 1% of the shares outstanding. However, JANA's presence could signal that other activist hedge funds may be trying to get Liberty Media to pay more if it wants to own all of Sirius XM.

Streaming an upgrade
Pandora's had a pretty spectacular run, more than quadrupling since the beginning of last year.  

MKM Partners upgraded Pandora on Wednesday. It may not seem like much of a boost -- going from "sell" to "neutral" -- and its price target of $39 is essentially where the stock was at the time of the move. However, this is essentially another bear throwing in the towel on the market's leading provider of streaming audio that served up 1.38 billion hours of content during the short month of February alone.

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It was a quiet week for Sirius XM, but the new week isn't likely to be dull. While we wait for the latest news to roll in, we can keep looking around the market for other great investing ideas. Why not start with the Fool's own David Gardner, who has proved the critics wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%? In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple and Pandora Media and owns shares of Apple, Liberty Media, Pandora Media, and Sirius XM Radio. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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