Sirius Earnings Immune to the Woes of the World

Media

Published: July 25, 2015 9:25 am

Sirius XM Holdings Inc. (NASDAQ: SIRI) is set to release its second-quarter earnings report on Tuesday. The consensus estimates from Thomson Reuters call for $0.03 in earnings per share (EPS) on $1.12 billion in revenue. In the same period of last year, Sirius posted EPS of $0.02 and $1.04 billion in revenue.

If you were watching this stock, Sirius looked like it might implode during the recession. The satellite radio giant was able to stay afloat and then grow due to its number one position for the installation of its devices in new cars. This stock traded down into the land of penny stocks, then recovered to $1 and has since climbed up to the $4 mark.

Sirius XM owes a lot to Mel Karmazin for his hand in keeping the company growing and refinancing the debt. Karmazin brought in John Malone with rescue financing, even if that came at a cost, and even if Malone made out like a bandit. Sirius XM effectively was able to refinance all the coming debt and prevented a second to worst case scenario from taking place.

The company is now in a post-Karmazin era and has so far also been able to retain Howard Stern to keep him and his listeners there. Other artists and personalities have been added over the years to continually bolster the talent lineup.

In the first quarter, the company added 431,000 net new subscribers, a 61% increase from the 267,000 net new subscribers in the same period of the previous year.

ALSO READ: Customer Service Hall of Shame

At the same time, the company increased its guidance on not just revenue but subscribers as well for the 2015 full year. If Sirius keeps up this earnings momentum, it could be a very bright year in this company’s turnaround.

Analysts weighed in on Sirius in the second quarter, ahead of its earnings:

FBR reiterated a Buy rating.
Macquarie has a Buy rating and a $4.50 price target.
Piper Jaffray has an Overweight rating and raised its price target to $5.25 from $5.00.

So far, Sirius has outperformed the broad markets, with shares up over 11% year to date.

Shares of Sirius were up 0.5% to $3.91 Friday afternoon. The stock has a consensus analyst price target of $4.46 and a 52-week trading range of $3.14 to $4.04.

Take Charge of Your Retirement In Just A Few Minutes (Sponsor)

Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.

Here’s how it works:

Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.

Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!