What to Expect in Tuesday's Sirius XM Radio Conference 110 comments
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I am off to California for a couple of days, and am looking forward to Mel Karmazin’s speech at the Merrill Lynch Media conference. It seems that many investors, analysts and sector followers are awaiting this conference with great anticipation and expectations. After all, it is the first time since Labor Day that Mel Karmazin will be making a speech, and everyone has been eager to see where the company now stands a bit over a month after FCC approval was granted.
With regard to Tuesday’s speech, from an equity perspective, I am going into it with reasonable expectations with room for surprise. I think it possible that enough time has passed for the Sirius XM Radio (SIRI) CEO to give some merger flavor, as well as guidance. I feel that some plans for consumers will be outlined, and that we will begin to see the merged company taking shape.
In actuality, I am looking at the speech as more of a launch pad for additional information. Let’s not forget that this is not only a satellite radio conference. This is an overall media conference, and using it as a forum for several major PR announcements would not seem to fit with the style of conference at hand. Instead, I look for new information that will likely be generalized, and used as a platform for additional Press Releases and announcements over the coming weeks. It will be the Sirius XM Press Releases that contain the details.
While at the conference, I would anticipate that the Sirius XM team would make themselves available to answer analyst questions regarding everything from financials to projections, to how various metrics will be accounted for by the merged company. In time, these analysts will begin to issue new reports regarding the company. The end of the third quarter is fast approaching, and now is the time that analysts will need to change their models. The balance of September should be interesting.
Thus, I feel it important that sector followers listen to the speech, but temper enthusiasm for announcements with the realization that this conference is not a Sirius XM Radio conference, but rather a general media conference.
Position - Long SIRI
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This article has 110 comments:
When will you pontificators admit that only going black will move this stock. This pps/pos is no longer event driven. They used up their "wolf" back in the Panero days. Show us the money, because you've sure shown us the bull crap long enough.
Backseat video!!! ..CFBE 2019......No commercials!!!
Plowboy is a SIRI shorter!!!
Read his (her?) last 10 posts...
NOTHING!!!!!!!!!!!!!
See ya under a buck.
informative.
But I will be very critical of Mel if he does not provide a quarter-by-quarter P&L proforma guidance between now and then--all the way out to 12/31/09. Same for cash flow, gross and net sub additions, sub acquisition costs, rev per sub, etc. The number crunchers within the company are very remiss if they do not have this stuff, and they should share it with shareholders, particularly after a game-changing merger.
This management's pronouncements have been way too much hype and not enough hard numbers all along, and today's $1.26 pps reflects this. I listen to a lot of quarterly conference calls, and compared to 99 percent of them Mel is an embarrassment.
this stock will take off to the moon!!!!
He has to give us and analysts something to move forward with. He said there would be clarity after Labor Day, so far nothing. Today is his day to shine and investors should expect nothing less.
Mel, PLEASE get partner with other Blue Chip or Sell to Private Equity!!!
you want to sure someone for selling stock?
"bro", your problem is you are long a company in deep debt with huge negative cashflow. and that debt is about to cost much more. it's a sprial, dude. get out duuuuude.
I'd say the 15%-20% range...
Mel's MO is "under promise and over deliver" in every aspect--revenue, debt, promotions, etc.--of the company. I thought the classic line from the conference was, "We could put Satellite Radio in a toaster too, but we're not doing anything unless it's cash flow positive for the company." Or something like that.
This company will absolutely take off under Mel's leadership. The only painful part is waiting a year or two for this company to realize all its potential.
Sign Cramer as content and maybe this stock will take off to the moon!
Until the three 2009 debt scenario's are behind us, and the company officially becomes cashflow positive (including capital exp.), this stock is going to be all over the chart. But after all of this, the upside is huge.
I have total faith with Mel's hands on the wheel.
I think this presentation was much more than what was presented here in this article. There is really no need for a CC now and we'll get 3Qtr results and I believe they will be in line with a company writing off merger one times and improved cash flow from operations. This is what I consider a good solid presentation of the company's situation at this time. Jswede's concerns are legitimate but not seeking further bond debt through converts is positive. 15% would be reasonable to expect but, with cash flow increasing and ala-cart arriving in 9 weeks post merger not 9 months and Best of Both also launching, I don't see the debt as unmanageable.
Long runs to the upside generally mean the SP will "retrace" and using a small percentage, say 10-15%, of your long position to short the stock in a company you like, can have you making money on the down trends. When you cover your short position by essentially buying the shares you borrowed from yourself, at a lower price you make money by selling the accumulated share difference or you can continue to hold them long increasing your overall share total in the company. This is sometimes referred to as "playing the channel" in a company that you generally like and are long in. You do have to have a margin account to do this because your initial short position is to borrow shares. The risk is if the share price goes up you will pay a higher price to cover your short position and either lose money or shares.
the otherwise "rosy" $350mil loss in 08 and positive $300mil in 09 are EBIDTA, so the above interest costs are not factored in.... neither is...
* $101mil/yr in debt service from the 13% bonds issued July
* ~$40mil/yr from the XMSR 7% converts also issued July
* ~$15mil/yr from the XMSR floaters
* $40mil/yr on the 10% converts due 12/09
* $50mil/yr on the 9.625% of 8/13
..including the $45mil/yr at the top, that's close to $300mil/yr in debt service right there, and there's also a bank line-of-credit around $350mil, IIRC, to refinance in May... and a few other smaller pieces.. Then who knows? Will they need to borrow even more to fund operations...?
regardless, that projected positive EBITDA of $300mil in 2009 doesn't look so positive anymore.... to me, anyway - seems I'm the only one.
They even having target prices varying from $2 to $6
Are those people stupid, or they pumping up the stock and then dumping it
Just like Cramer saying when merger happens this baby will double to $5 and more ... he said the fundementals are there
I see more explanation is needed here. Ok, Im going to fire out the big guns, since I think we all need to know whats going on here.
1. Goldman Sachs is THE investment bank. Period. CFR, Builderberg, etc.. backed.
2. JPMorgan is THE bank of the powers that be. Period. No argueing it, and I wont debate the above two points.
3. Jessie Jackson is a 33 1/2 degree mason. This means that he is knowledgable about the future events, economic future, and where the media controls need to be. Jessie Jackson is an evil man thats only purpose is to use his control to affect "the powers that be" PTB from now on interests.
4. All three are bascially trying to gain control of this company, or keep them from becoming profitable, unless they consented to their ideas of control. The merger helped, easier to control one company than two. Ok, thats done. Now, get THEIR programming on it(those "minority owned" channels) Done. Now attempt to bankrupt the company, so a cheap bidder can come in and gobble it up for cheap.
Their enemy: You and I, the shareholders. We expect value and to remain in control of the company. If Comcat, or Apple, or whoever buys Sirius, its only a matter of time(I think it would be at a share premium not a discount, as their would be many bidders.) They are waiting to see if they will make it first. I was hoping a bidder would come in at around 4-6, now Id take 3-4. They wont be sucessfull in bankrupting the company, but they can take the stock off the exchange. The only way to not allow that would be to pay off their debt, which isnt happening anytime soon. They need to keep the price above 1.50 to be safe. I hope they do, and good luck to everyone.
The key here is the players.
1. GS
2. No JPmorgan involvment. They have money to loan, but they refused. Strongest bank in the US said no to Sirius basically. This has a trickle down effect, especially today.
3. Jessie Jacksons involvement. Remember hes a mason,an evil man, and a puppet for the PTB. The PTB interest in Sirius is good and bad. Depends on how they try to acquire control. They might already have it, the minority owned station thing might just be a smoke screen to think they fought that. Dont know Mels background, but if he controlled CBS radio, then hes part of TBP. And THATS why I bought the stock in the first place. This is all a shell game to make you sell. I think if there is a buyout it will be for a nice jump, and if they dont, then this is a minimum $20 stock in 3 years.
The company now expects to end 2008 with about 19.5 million subscribers, and projects 2009's membership will rise to 21.5 million. That's far below the breakneck pace the firms separately saw in recent years.
Sirius XM also projected 2008 pro forma revenue of $2.4 billion, with a jump from that to $2.7 billion next year. Analysts polled by Thomson Reuters were looking for 2009 revenue of $2.78 billion.
The firm also raised its estimate for 2009 net synergies from the merger by $25 million to $425 million.
"We have made great strides over the last six weeks and continue to make progress integrating the company and delivering on our promises to customers and stockholders," Chief Executive Mel Karmazin said in a statement.
Sirius XM also said it expects a $350 million loss in earnings from interest, tax, depreciation and amortization, while confirming its expectations for 2009 are for a profit of $300 million. Analysts were recently looking for a $169.7 million profit on that basis for next year.
The company also announced its new Best of Both programming options Tuesday, which provides stations available to customers of XM and Sirius programming. The feature will add Martha Stewart Living, Sirius NFL Radio and Sirius Nascar Radio to XM customers' offerings, while Sirius customers will now get Oprah & Friends, College Sports and the PGA Tour station, among others. The offering will cost $16.99 a month.
Several analysts have said the synergies created by the merger of Sirius and XM would make Sirius stronger against its competition, which includes iPods and conventional radio.
-By Donna Kardos, Dow Jones Newswires; 201-938-5963; donna.kardos@dowjones....
I just realized you are insane.
>> Mel buying 2mil shares? That's change lying around his house -- less than $3mil. He was getting $20mil/yr at Viacom - he mase $100mil in 5 years there. A little buy of ONLY $3mil in the company he runs, is preaching positive about, and is trading dirt cheap is more a sign of trouble than of confidence.
Goldman owns like nothing. I see 3.1mil shares, is that right? They bought 1.4mil in June - that was a rebalancing - they were simply underweight Sat Radio b/c the stock lost so much in value.
"Their enemy: You and I, the shareholders. We expect value and to remain in control of the company."
>>Right now, and for the visible future, the bondholders own this company. The equity the shareholders "own" was *negative* $800mil last I checked, and that's not going to improve any, if at all, as "synergies" will pretty much be eaten up by debt costs.
"They are waiting to see if they will make it first. I was hoping a bidder would come in at around 4-6, now Id take 3-4."
>> My guess would be a massive dilution in 2009, by new converts or new equity issued to a provider of capital. All in the $1 range.
>> now THAT, is some funny math.... so if they have EBITDA of $600mil ($2.7b - $2.1b), they will "pay off their debt in a few years"!??!!?
They are/will be paying about $400mil a year in INTEREST going forward -- so even if they can use the other $200mil to pay down debt, it would take them DECADES to pay it down.
The new debt in Feb 09 15%-2.5%(existing) nets to 12.5% impact or $37.5 Mil additional expense. The credit facilities in May 09, $350 M will be extended and they're not cheap now because of their variable
rate, but add 5% to that (if they're at 10%), that's an additional $17M.
If the 10% 12/09 debt goes to 15%, 1 month of 2009, thats a nominal increase for 2009 financial results.
So presenting the numbers stand alone makes them look grim but, when you net the changes out your looking at $65 M impact beyond what's already in their guidance for 08, 09. I believe that is why analysts had synergies in the $700 M range. They didn't know what the company did and synergies are projected now at $425 M / yr. This is before we even begin talking about increased revenues from Best of Both, Used Cars in 2009, Ala-Cart and the retail sales, etc.
We have had this conversation before and I believe you have to look at the whole picture not just the Debt and its impact.
Now, Should I sell or Hold or Buy?
How can you buy the SIRI-XM bonds or prefered stock?
long siri
Several points of interest.
Mel-Owns less share value than his salary at Viacom. Ok, that might be true, but he was obviously waiting for it to hit $1, as you can see, lol.
Smart man. Averaging down nicely Id say. I have a background in math, and i am very visual. I sit down and watch how ALL stocks trade, from 150 dollars, to high volume to low volume and .50 cent value. You do this to understand how prices move. You spout the stock went up 20 cents today. Well, do you know why it went up 20 cents today, how fast, in what time of day, due to what level of news available? These are all questions you pee brain cant fathom, so dont try buddy.
When I watch these stocks I know for a fact their is a computer program running to keep a stock up, or down.
LEH:Only on certain days will it run normal. Like today, when you had positive news all week about financials.Otherwise this stock is a joke. Should have been $2 by now a long time ago.
All major banks basically.
Homebuilders:KBH is being manipulated
Sirius:
Yamana Gold:Big time Down past levels 2 YEARS AGO, and they have a much higher volume mined, and cash flow. Also on verge of doubling production, and its being traded in an inflated currency, and it cant keep its levels. Why? Because dummy, its a big game, and your playing in it. If you feel this isnt a game, get out now, cause thats all it is. A big smoke and mirror show. When all you losers who bitched about selling at 1.50, etc.. are gone, they stock will go up, and not until then. When you have long forgotten about us, we will be jumping up and down looking at our 1-10 bagger, depending on when we sell. See, then, Ill be writing covered calls against my stock every month, and sitting on a beach somewhere thinking of you. I might send you a postcard. I know this stock will go up, because they are MANIPULATING it. Thats all I need to know. Where is LEH now. They were keeping that stock UP. Now its 8. Exactly. Find out which way they are manipulating a stock, and bet long the opposite direction, because eventually thats where it is going. Im bagging over 2 grand today on my KBH short because I was patient. See what its doing today. This is one of those they let it go days, and they dont even bother. They will pick up manipulating it again later.
>> $600mil, less ~$300mil in interest expense, somehow pays off $4bil in loans and debt in 3-4 years? is that right?
After all he is interested in Extraterestial Aliens
Sirius is the way to contact them
the sad thing Mcain won't do it, he does not know how to use a PC -- SatRadio would be an inigma for him to bail out
Every times he talks, stock goes down, 4 wks ago was 1.88, now see were he took us far south
I've just become fascinated by the fact that not one person mentions the massive debt on these threads. It's like it doesn't exist. So I visit from time to time to see what the thoughts are...
I am not in the conversation above with Relmor because its all to speculative, and outside the box for me. I'm sure he thinks he's on to something but its not tangible enough for me to do anything with. For all our sakes I hope the stock going up happens soon.
no idea, even with your astronomical optimism on revenues and expenses, how you think they'll pay off that debt.
their balance sheet has liabilities $900mil greater than assets. they are about to refinance about $1bil in '09 at 15-16%....
"sniff being debt free by end of 2009"??? what???
Closed at $ 1.14 !
Can you say " PENNY STOCK" !
Like the Stock!
LOL!!!
On Sep 10 09:31 AM killerkaul wrote:
> Do not weaken and play into the shorts, this is what they are counting
> on.