Seeking Alpha

SXM_Permabull4Life

SXM_Permabull4Life
Send Message
View as an RSS Feed
View SXM_Permabull4Life's Comments BY TICKER:
Latest  |  Highest rated
  • Effect Of Sirius XM's Share Buyback To Diminish [View article]
    "If this is your opinion then you should own LMCA."

    I do own a few shares of LMCA. I like stock and think over the long term may offer greater return than Sirius.

    Holding sirius has more to do than tax reasons. While I see limited growth compared to what I'd like or what other investments may offer, I don't see much downside. I like apple for example, as a growth story. But it's risky. As soon as the newest product fails to "innovate" they could lose some market cap. But it is important to take some risk and their track record has me convinced that it's risk worth taking. Sirius, I view as more spec. And while I may not see the returns I would like, I don't see much downside. I don't expect to lose on Sirius and long term I should do better than I'd do in a savings account. Taken together with my other holdings it has its place in my portfolio.

    The company also has some desirable traits which for me means it will be viable long term even if not fast growth. Even with higher than desirable debt, the company is still growing subs (some cable/sat tv companies can't say that). If they can be competitive in the connected car space longer term, the reduced share count can benefit patient investers post-spin once Sirius begins paying off that debt. That's looking down the road a ways.

    Unlike CN, I don't dislike share buybacks. I just think they benefit Malone more than the minority shareholder...but patient...very patient...investments can be rewarded if they can continue to grow their financial health through price increases, additional revenue streams, etc...and then pay down some of that debt. The story is interesting, worth holding, but I just think the rapid growth days are behind us. I won't hold sirius in the hopes of "it's going to $10!" But I will hold it as an interesting spec play that has limited downside. As for LMCA...I may add over time, but I want to see more color on what they have in store for future plans. LMCA (currently) doesn't give exposure to a TWC deal from Charter as far as I can tell...but what will they do with their post-spin cash? Over time as that picture becomes more clear I'd be happy to buy more if I like what I see.
    May 21, 2015. 10:43 PM | 1 Like Like |Link to Comment
  • Effect Of Sirius XM's Share Buyback To Diminish [View article]
    "Effect of sirius xm's buyback to diminish..."

    There was an effect?

    Sirius' management continually trumpets how it has returned tons of cash to its shareholders. It doesn't specify to which one(s). The buyback mostly benefits liberty by increasing its ownership, making a merger more affordable or in some ways makes a spin-off more profitable. He grows his ownership ever so big, spins it off...pocketing billions...while the minority shareholder gets a debt-loaded company with few financial options for growth. The thing probably won't default, but Sirius is not without risks in my opinion.

    That said, I plan on holding. Don't yet want to pay the taxes, and I still see slow & steady growth as a potential with the company moving towards other businesses and continuing to grow subs (not rate but number). In short I still see sirius trading higher 4-5 years from now than it is today. I don't view it as a buy or a sell, so I'll just hold it and sit tight and see what happens. Meanwhile I'll continue adding to my position in AAPL, and BRK.B looks tempting w/ recent pullback from the highs...trading in the mid 140s after a high in the mid 150s with a P/E comparable to the broad market. Not sure if I'll start a position in that one or not but certainly thinking about it. Sirius can make up a part of one's portfolio, but I view it as a spec play nowadays as opposed to a growth story. I'll be happy to be wrong. We'll see.
    May 21, 2015. 09:38 PM | 3 Likes Like |Link to Comment
  • Sirius XM: Why I'm Buying The Stock Despite Its First-Quarter Earnings Miss [View article]
    I have a question actually, and perhaps someone out there can answer. I hear often that it's a good thing when a company buys back its stock that the shares drag so that it can buyback as cheaply as possible. If a company is investing in itself it means it believes that its shares are undervalued. However, when a company stops the buyback, isn't then the perception that the shares are no longer undervalued? So, what then would drive price appreciation after buyback activity drops off? How can a company wind down buyback activity without sending the signal that the share price has become too heated or that it's no longer a wise investment to repurchase the company's own shares?
    May 3, 2015. 07:09 PM | Likes Like |Link to Comment
  • Sirius XM: Why I'm Buying The Stock Despite Its First-Quarter Earnings Miss [View article]
    RSaint-

    I recall back when Sirius had a P/E ratio of 61, and even as low as 56 you were writing articles calling Sirius too expensive. I am somewhat skeptical as to whether or not EPS can get to 0.11 or 0.12 this year. Another earnings miss and they may only see EOY EPS of 0.10. That places the P/E ratio of near 50 if it were to trade at $5. With slower growth ahead, and prospects of taxes eating away at FCF (as expressed by CN and analyst at Deutsche Bank as well btw), I'd expect multiple contraction. Therefore if 60 was expensive a year ago, a P/E of 45-50 may be considered expensive right now. If anything Sirius may be fairly valued and that may partially be why it's range bound. Until we can be "shown the numbers" of future growth, it's hard for Sirius to break out. On the other hand, Sirius has been holding it's own pretty steadily, and hasn't really disappointed all that much, so I'd tend to think that the shares can't drop much from here either outside of a broad market selloff. If anything shares may be able to drift up to $4.50-$5 when looking ahead to 2016 multiples, but I wouldn't call those cheap valuations. If EPS can grow 20% from .1 to 0.12, then $5 would be 42x earnings. Not too outrageous. Sirius would have to report EPS of at least 0.03 every quarter in 2016 to get there, and Sirius does like to have earnings misses from one time expenses and the like. So again I'm a skeptic. I wouldn't be holding the shares if I didn't think it had good long term prospects. But I think the fast growth days are over. I think the shares certainly could trade near $5 at the end of this year or sometime in 2016...but with a potential P/E of 42x even then, it's anything but cheap for a company with slowing growth and...don't forget that the tax man is coming! $5 may be a more reasonable valuation in 2017 based on what I'm seeing....but I'd GLADLY be surprised. :)
    May 3, 2015. 04:59 PM | 1 Like Like |Link to Comment
  • Apple: Here's Why The Stock Will Take Out $140 Before The End Of May [View article]
    RSaint-

    Interesting read. I sure am glad that I've started a position in AAPL. I wish I started one a few years ago when I started investing in spring 2010! Still, there should be plenty of growth opportunities over the next 5 years. I'm up to 59 shares and will be in a position to add a few before the June event (WWDC?). I wish I could add at today's levels given the sp may be higher by then. I think the growth story goes for much longer though given what they may do in the TV space, next version of the watch, future wearables, future services, ipad turnaround, and who knows the endless possibilities that they could do with all that cash! While much of it is tied up overseas it is still very impressive. Technology changes fast and who knows whether they will remain dominant a few years from now...but it sure is hard to bet against apple. And as others have learned, if you can't beat them, join them! Have you noticed the ads on YouTube for Samsung's new edge? Looks familiar! :)
    May 3, 2015. 04:23 PM | 2 Likes Like |Link to Comment
  • Is Sirius XM Ready To Buy Content For Connected Vehicle Business? [View article]
    "From my perspective it makes about as much sense to compare Sirius to AAPL as it does to compare Sirius to underwear maker HBI."


    I like to compare Sirius to Apple only usually on one occasion...When someone says that the reason Sirius' stock isn't going anywhere is because it has too many outstanding shares. Given both companies have similar outstanding share counts, but yet each has performed markedly differently over the past 1-2 years, this makes defending that argument a futile exercise.
    May 2, 2015. 12:18 AM | Likes Like |Link to Comment
  • Sirius XM Short Interest Continues To Hit New Lows [View article]
    CN,

    Thanks. I suppose hearing about too many outstanding shares has become a pet peeve of mine and so I went off, but probably should have had restraint. I didn't mean to imply a reverse split, but the overall point I wanted to make was if you had two companies, say $4/share with 10,000,000,000 shares or $40/share with $1,000,000,000, the $40 stock isn't a better deal simply because it has fewer outstanding shares. By the same token a $4 stock doesn't necessarily mean it's cheaper than a $40 one in the same space. The appreciation in your portfolio is ultimately what matters, and far as I can tell, the number of outstanding shares that a company sports doesn't really affect that.
    Apr 23, 2015. 05:42 PM | 1 Like Like |Link to Comment
  • Sirius XM Short Interest Continues To Hit New Lows [View article]
    On another note, some online sources are starting to suggest that Comcast may drop its bid for Time Warner. Be interesting to see what that means for Liberty...and any interest to buy Sirius (again) so that it can make an offer.
    Apr 23, 2015. 05:38 PM | Likes Like |Link to Comment
  • Sirius XM Short Interest Continues To Hit New Lows [View article]
    CN-

    I too would like more color on CVS, but I'm not optimistic we'll get it...
    Apr 23, 2015. 07:30 AM | Likes Like |Link to Comment
  • Sirius XM Short Interest Continues To Hit New Lows [View article]
    "too many outstanding shares..."

    Apple has a comparatively similar number of shares outstanding. It's not the number of shares that matters, but the growth rate of key metrics such as FCF, the ability to deliver on the bottom line, and future prospects of growth opportunities.

    Whether you grow the stock price from $4 to $5 or $40 to $50 with 1/10 the shares outanding to conserve market cap, the appreciation in stock price as a percent would be the same.
    Apr 23, 2015. 07:27 AM | 4 Likes Like |Link to Comment
  • Sirius XM Short Interest Continues To Hit New Lows [View article]
    Thanks for the piece CN!

    I was hoping you would write up something before earnings. I wonder if this will finally be the earnings call that can get the stock back up to October 2013 highs? It's been a long time coming. I'm still hanging on...

    As for the shorts, short squeeze hype, and the like, it makes for nice swings I suppose...but I would much rather see the stock move up on earnings. If we had a run over $4.20 due to a short squeeze based on some speculation about the connected car, I guess I'll take it. But I'd much rather see that same run happen following a quarterly EPS beat, say it came in at 0.04. I won't hold my breath, but at least it appears (for now) that it has bottomed. It seems more likely at this point that it drifts back over $4 instead of back down to $3.50...but never say never.
    Apr 23, 2015. 01:34 AM | Likes Like |Link to Comment
  • Sirius XM And Free Cash [View article]
    CN-

    Thanks for the great article! You have been dearly missed & I enjoyed the read. I do share concerns about taxes and interest rates from rising debt levels impacting FCF growth over time. Sirius may be the company where $3.50 stays fair value for years just because of multiple contraction! Anyways, I do disagree about Stern leaving causing an upset. While there would be revenue losses from some sub cancellations, there would be programming savings as well (don't have to pay Stern's salary). Plus there would be ways to help slow the losses of subs...by keeping Stern channels up, playing archives, trivia, and more...and while over time there may still be some subs that cancel, many may linger for a bit for "nostalgia." All the meanwhile with the savings on Stern's salary, they could afford new content to bring back new subs, or invest in other businesses (hopefully something more fruitful than Agero). So, I disagree that losing Stern would be a big blow, though I do share concerns about slowing FCF growth.

    I am so thankful I've been buying other things. I'll hold my 3660 shares of Sirius, and maybe by the end of the decade the thing will be worth $7 or $8/share if I am lucky. Otherwise I do have a few LMCA shares (45) and maybe something will happen there over a few years. I plan to continue buying AAPL too...and recently purchased my 50th share on this dip. If the SP stays under $200 by EOY I should be able to double that. I like their prospects for at least the next couple of years. I won't go further given that this is a Sirius article though and not an Apple article. Having said that though I think much can be gained by the idea of NOT putting all of one's eggs in one basket!!! :)
    Mar 30, 2015. 05:14 PM | 2 Likes Like |Link to Comment
  • Liberty Media: Profits more than double; broadband spinoff wraps [View news story]
    CN! It's more of the same with Sirius. I still hold shares, will see what happens. Getting in apple was a very smart move for me, and I anticipate good long term things from the watch. I only feel I'm chasing it up though trying to get a decent position, LOL. I could use a good pullback. The thing is more than $750B in market cap, and perhaps going to be zeroing in on a trillion. It couldn't possibly keep going from there, right??? ;)
    Feb 26, 2015. 10:58 PM | Likes Like |Link to Comment
  • Sirius XM: Thoughts Heading Into Earnings [View article]
    Be interesting to see what tomorrow brings. Now that I no longer hold options, the thing will probably pop to $4. :-p

    If I sold my shares it would go to $5. But I'm holding them. In fact, I plan to add on to them each month during the course of the next year at least - as long as the "story" stays the same. Signs point toward a leg up, so it looks like I'll be buying higher during the course of the next year. But hopefully it won't be anything compared to where SIRI might trade in several years. Got to think of the long term strategy, the big picture.
    Feb 4, 2015. 06:20 PM | Likes Like |Link to Comment
  • Sirius XM: A Puppet On A String [View article]
    Hi CN,

    Well, I did it. I've made that painful move and I'm done with those options as of this morning. I guess if I wanna report a loss for tax purposes for the next few years, I'll have to buy LMCA shares for the next 30 days, eh? ;)

    Actually I don't know how it works with regards to options and the 30 day window there and so forth. I have some research to do. I am looking forward to your future articles though...I'm not entirely done with SIRI yet...I still own shares, and I too look forward to ARPU and other metrics at the call. So we're looking at a beat for 2014..but we don't know how much of a beat. Interestingly, the bigger the beat (good news), the worse 2015 guidance looks as a percentage increase YOY (bad news). However, the converse is also true. The smaller the beat (bad news), the better 2015 guidance looks as a percentage increase YOY. I prefer the latter because it shows future growth ahead, while the former would show a better than expected 2014 but drastically smaller growth ahead. Interesting place to be in.
    Jan 14, 2015. 10:18 AM | Likes Like |Link to Comment
COMMENTS STATS
336 Comments
235 Likes