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jswede
156 Comments
Why Apple Stock Is Poised To Go Flat - At Best
What does this mean? What "sea of red"...?
Why Apple Stock Is Poised To Go Flat - At Best
Dell is contracting/flat in revenue/profits and while AAPL went from $327mil in profits to $3.5bil in 3yrs... AAPL is gaining PC marketshare by a few % a year, 2 businesses that didn't exist a few years ago are now pulling in billions in revenue...
have you looked at the balance sheet? the income statement? ever?
Why Apple Stock Is Poised To Go Flat - At Best
Click "portfolio" to see his masterpiece of a diversified portfolio:
it's made up of only the most beat up financials and homebuilders - with a few 2x leveraged ETFs - the Dow and, again, Homebuilders....
obviously ZERO, none, nada requirements to post an article.
Leave Sirius Alone!
$2.74mil is not a lot of money for Mel - it's nothing as a matter of fact - not like he's "risking" anything - how much lower could it get right now? ('eventually', that's a diff story)... Neither is 8mil shares for GS - that was just a rebalancing of their portfolio - they were 'underweight sat radio' - go figure... You guys hang on to these purchases like they mean something...
Equally amusing is are the Cramer rants... "conspiracy"... lol. The buying power of all Cramer-watchers put together is a drop in the bucket. Means NOTHING overall or in longterm - it's petty cash. Amusing though.
Sirius XM Cramer Wars Part II
Sirius XM Waves Goodbye to S&P CreditWatch
as far as IR... internet radio is not there yet, but this doesn't take long - wireless only got the the level of handling streaming radio, at this capacity, in the last year..... I don't think it takes 3-5 years, at all. I have 4 services on my iphone that get me 500 stations where ever I go (for free, with my std data plan, and I play it in my car stereo also)... now Siri wants to be right next to them in my iPhone, right?... well, IR will be right next to Siri in the car in short order... and no I don't think overnight Siri loses subscribers... but they will have competition... and competition that is starting with a clean balance sheet..
anyway, since it's just you and me left in this thread, I think we see each other's views -- I think we agree it's tight cashflows and a tight window to make it happen -- you feel strongly on the subscriber growth and synergies, whereas I'm less optimistic it plays out as well in the synergies and I think sub growth slows significantly in the next years...
take care cos - see you in the next discussion..
Sirius XM Waves Goodbye to S&P CreditWatch
much better, obviously --- it's just the worst of timing ot have to go to market and borrow.. and they are also short on time... the credit markets didn't price in risk appropriately from, say 2003-2007, with financing getting cheaper and cheaper... and now it swings the other way -- financing is incredibly hard/expensive to come by. use the 16% yield on the 5yr bond and the 7% on the converts as a proxy. it's NOT going to be any better in 2009 for them. Credit will be hard to come by for years.
I hear your good numbers for revenue growth and synergies (and I don't dismiss them at all -- I was a big long bull until early 2008), but at this point I'm looking at it as being too late (and that's not all DoJ's fault)... they're paying $100mil/yr interest on only the $778.5mil par ($700mil face amt) amount they borrowed last month, and another ~$30mil/yr on the 7% converts... they are in a horrible spot for re-financing their debt in 2009...
do the math: if they get approx 15% rate on the $1bil that needs to be re-financed in 2009, that's ANOTHER $150mil/yr... (on top of the $100mil/yr interest from the 16% yield notes, on top of the $30mil/yrs interest on the new converts, and on top of the interest of the other $2bil in loans/bonds/converts..... (and yes, I know there is a line of credit included in the 2009 debt coming due, and a convert in there also... but it will hit equity holders just as hard regardless....)
I don't see them getting out from under this... Mel is hoping - like Lehman Bros, Merrill, and countless of regional banks - that this credit market recovers in short order and all is restored in the next months... but that's a dream -- this hangover will take many more years...
and the more SiriXM needs to borrow at high rates, the worse their credit standing gets, the higher cost to borrow, and so forth... it's a spiral.. you know this.
IMO, you're looking at SIRI buried in interest payments and if they want to survive, somewhere down the road perhaps in late 2009 or 2010, they have to strike a deal where they pretty much give away the company's upside to new capital investors, more or less wiping out, or diluting incredibly, the existing shareholders...
I LIKE THE SiriusXM story -- they are gaining traction and the synergies make sense -- it's just an "ugly" picture right now, to borrow Mel's words, and it's not getting prettier any time soon...
(my second bearish take on take on Siri draws nothing from my expertise, just from my experience as a consumer, and that's the coming internet radio competition - that competition has virtually no barriers to entry, no start-up costs, no debt... and the only good counter to that I've heard is SiriXM has "content"... that may be true, but even if they lose only 15-25% of potential customers down the road, it will seriously hurt.... and who's to say an internet radio station couldn't sign a big star, or a sports league, down the line using the same subscription service as Siri... with, again, no debt to worry about)
Still, the Crooks Be Winnin’
Ponzis take a while to play out. With high-level connections to an undermanned SEC, even longer... doesn't change anything material. It's fraud.
Sirius XM Waves Goodbye to S&P CreditWatch
"Huge news. Huge."
"This should now enable Sirius to receive much better financing going forward."
not one of you guys have any idea of what is going on in the credit markets. or how they work in general.
1) the rating agencies have pretty much zero credibility right now and won't for at least the next half decade. in fact, they'll probably go under from the coming wave of lawsuits resulting from sub-prime and muni issues etc. The credit market is not, by any means, looking to S&P for an opinion on what a credit is worth. Not by a long shot.
2) the last large(er) non-investment grade deal was a B3/B rated issue -- several notches above SiriXM -- and they paid 12%... that is, 12% over the UST, for about a 14.5%coupon. Even better rated Texas Industries (Ba3/BB-) paid ~9% to borrow for 5 years... SiriXM is in the mid-teens if they come today.
3) even if this were 2 years ago, when S&P mattered, let's put this CCC rating into perspective: there are 17 ratings above CCC, and only TWO below, before you get to the "D" rating, which means default. This rating is already sh!t -- this move really only says "we're going to keep it there for the foreseeable future". once the refinancing of 09 goes into effect, and we're looking at interest rates in the teens across the board, then it's really lights out...
"much better financing going forward"... LOL. yea, maybe if they're lucky instead of 16%, they pay 15% next time. and it will have nothing do with S&P...
this news is about as insignificant as the "maddog" news... can we get a few more stories on that please?
and in all this time no one has even mentioned the fact that Mel called the last debt deals "ugly".... not once. he agrees the debt is killing him, but that's not worthy of a SA story, huh?
and cos, you really know a lot - I enjoy your posts, but if SiriXM allows its sub to default/fail, the parent co will never get financing again. as the XM sub goes, SiriXM will go.
For Those Infrastructure Plays, Everything You Ever Needed To Know About Cement
What’s Going on with Sirius XM Stock?
>> In that case, it's clear our opinion is worthless. You have no idea what is going on in the credit markets. SiriXM just had to issue 5yr debt at 16% yield, and a convertible at 7%. This is absolutely the WORST time in Sat Radio's life to refinance debt. 5yrs at 16%!!?!?! a convertible at 7%?!?!?!? this is somehow "favorable"?...
"Sirius XM will have a much better balance sheet and as such should see an improvement in its credit rating by that time."
>>> SiriXM is rated Caa2 and is on NEGATIVE WATCH. This whole "we should see an improvement in credit rating" is based on fantasy / wishful thinking. You are talking about things you don't know anything about.
Fact is, the $1.1bil they'll need to refinance at MUCH HIGHER INTEREST RATES, not lower, further killing margin. You are absolutely clueless.
Citi: Sirius XM Is “Massively Undervalued”
Is the 'Mad Dog' Headed to Sirius XM's Sports Channel?
now Karmazin comes out today and calls the last debt deal he made "ugly", that he "hated it", and that SiriXM will have to deal with the $1bil in debt that is due in 2009 "sooner rather than latter", and still not a peep about it from the bulls...
rather we get some insignificant little blurb about a talk show host that may be moving over....
anyone want to talk real issues and tell me how they are going to get out from under this debt...?? anyone?
When Markets Break
Felix is comparing agency/gov't mortgage PASS-THROUGH security spreads to fixed term debentures of Tunisia and Panama.
Pass-throughs trade much wider because the investor takes on pre-payment risk of principal. The investor sells call options to the issuer for basis points in spread.
"Long-dated"... 30yr, FNMA debt (debentures - the apple-to-apple comparison) trade at around 5.20% today. That's a spread of about 72 basis points over the 30yr UST.
No real story here. MBS is cheap, but it's not emerging market cheap.
Sirius XM 2009 Debt Is a Non Issue for Investors
SiriXM has $300 MILLION of converts due 2/09 exchangable at $4.41.... looong shot...
...then another $400 MILLION of converts due 12/09 exchangeable at $10.87... again, loooong shot.... and these issues only make it less likely...
The author was right though, on the 8.75%s of 9/09... there's only $1.7mil of those... exchangeable at $28.46....
There's also a $350mil credit line due 5/09.
...but this should all be a "non issue for investors"....
I can't believe what I'm reading here... and all these longs have NO IDEA about this...