Arbitron (NYSE:ARB), Edison Research and Scarborough Research teamed up to conduct a July 2011 survey of 1,505 adults, 18 years of age and older. The trio titled the study, The Road Ahead: Media and Entertainment in the Car.
Here are some highlights from the study as they pertain to Sirius XM (NASDAQ:SIRI), Pandora (NYSE:P) and Apple (NASDAQ:AAPL).
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Looking at the evolution of in-car media between 2003 and 2011 proves somewhat telling. First, Apple is the clear winner. Just look at the growth in that iPod/MP3 number. And, even though a mobile stream of Pandora did not exist in 2003, it sits just two percentage points behind Sirius XM despite existing as an in-dash option in far fewer new cars than the satellite radio provider.
It's exactly this lack of aggressive marketing and slower-than-molasses roll out of satellite radio 2.0 - not to mention slow revenue growth that, even with increased guidance, falls short of analyst's estimates - that will keep SIRI from surpassing the all-important psychological level of $2.00, barring some type of M&A activity. And even with a takeover, I doubt the premium paid will end up much higher than that level.
If you have on-paper gains in SIRI it's likely time to take them. The longer you wait for another run past $2.00 and toward $2.44, the more those gains will fade away. If you are sitting on a loss, cut them now. I am glad that I did that at around $2.15 back in late July. And if you are a new investor, plenty of companies exist with massive growth potential in this broad space going forward.
AAPL, which appears poised to knock out its key psychological level of $400, once and for all, tops the list. If you have a few grand to invest, don't let the size of the position influence you. Ten shares of AAPL makes more sense than a couple thousand of SIRI any day of the week. The dreams of SIRI penny stock riches are a thing of the past. Don't chase them. While the lure of owning 2,000 shares rather than 10 can be strong, it's most often a losing proposition.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.