Sirius XM Radio Inc. (NASDAQ: SIRI) does not see big analyst calls all that often, so when it does, those reports tend to really stand out. A new report from Jessica Reif Cohen of Bank of America Merrill Lynch previews the satellite radio giant’s earnings for the third quarter. While this is not a traditional ratings upgrade, the upside projection that the firm has is one that deserves noting because it is the so-called street high analyst target. While the call had no impact on the stock Monday morning, it does highlight what would be long-term value ahead if the expectations come to fruition.

What stands out in this new reiterated Buy rating is that Cohen strongly reiterated the rating with a $5 price objective, indicating upside of close to 46%. The thesis behind the call is that Sirius XM is riding a rebound in auto sales that could lead to upside in subscriber numbers. One of the drivers here is getting Sirius XM into used cars, with its used car channel marketing now being integrated with some 13,000 car dealers.

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Merrill Lynch views the third quarter as an open road ahead as multiyear highs for U.S. new auto sales are driving subscriber upside. Another observation that had created some legal overhang is that the Turtles legal decision impact is being called immaterial.

Merrill Lynch highlighted Sirius XM as a business with scale that is enjoying accelerating growth due to a revived auto market. The firm also expects a renewed focus on leveraging and monetizing new technologies such as IP and telematics. The firm also sees above consensus capital returns.

Cohen largely maintained estimates for the third quarter and for 2014. The projections were noted as follows:

• Q3 revenue of $1.04 billion, 8% growth from last year
• Q3 adjusted EBITDA of $368 million, up 24% from last year
• Net added subscribers projected to be 333,000, versus 323,000 prior
• 2014 subscriber adds unchanged at 1.45 million, with 1.25 million being self-pay
• Average revenue per user now put at $12.60, slightly lower given higher mix from used car channel
• Q3 stock buyback remaining at estimated $700 million
• Lowered Q3 free cash flow estimate to $264 million from $308 million as the firm lowered its 2014 free cash flow target to $1.1 billion from $1.2 billion
• 2014 revenue remaining in-line with previous projections for 9% growth to $4.14 billion (versus consensus of $4.15 billion), with EBITDA up 23% at $1.44 billion

As far as subscriber numbers, Merrill Lynch has the following for total subscribers: 26.9666 million in 2014, 27.95 million in 2015 and 28.94 million in 2016.

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What really matters here about this Sirius XM call is the $5 price objective. This is the highest valuation among all analysts following Sirius XM. With shares trading at $3.41, Sirius XM has a 52-week range of $2.98 to $4.18 and a market cap of $19.4 billion. Shares were down three cents at $3.39 in midday trading on Monday.

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