By: Gino Lattarulo 
With the next Sirius earnings report to come out August 3rd, initial estimates are ranging from -0.01 (low), -0.013 (mid) and -0.02 (high).
As we all know, earnings numbers don’t coincide with price action too much, but this earnings event will be particularly interesting to me because of all the recent press that Sirius XM Radio (SIRI) has been getting. Articles from stock manipulation, options volume, new revenue streams like the Apple (AAPL) iPod app, the used car market and debt re-structuring have made SIRI’s price action go crazy. With volatility at almost 90% it is going to continue to be a wild ride.
So the question is what will happen? Will it shoot up ? Shoot down? Stay in a channel? Well I can honestly tell you that it will be one of the three. I can hear you all now, “THANK YOU captain obvious”, right?
What I really think will happen is that unless there is news that is shocking to the world, the stock price will likely experience the same push-pull panic buying and selling, that it has for the last two quarters and then settle back near its current price range. Barring an unseen catastrophe or shocking earnings report, there is no significant event that I foresee in the near future to drastically move SIRI in any one direction. As much as anyone, I would love to see it blast through the $1.00 range all at one time, but the realist in me says that it will be a slow grind. Virtually every analyst and investment house out there is making it a point to find reasons to beat this stock down until they have unloaded their short positions at a good price. WHOOOOPS! Did I just write that? My inner monologue must be on the fritz.
I think we all know that subscriber numbers are going to come in on the negative side and retail sales are not hitting any home runs. The positive news is that SIRI is continuing to move forward with growth strategies such as the recent deals with the likes of BMW and Volkswagen. The stock recently was rated a buy by Gabelli & Co. which stated
“while still speculative, they believe Sirius XM now represents an attractive equity investment.”
Gabelli is also alluding to the possibility of SIRI partnering in some fashion with Direct TV (DTV) or Dish Network (DISH). Whatever happens, there is a firm belief out there that growth and profitability are around the corner. It is just going to be a waiting game.
So strap yourselves in nice and tight for the next earnings ride ladies and gentleman. Grab your barf bags and fill the PEZ dispensers with Rolaids because it’s going to be another screamer.
Disclosure: Long Siri, no positions in AAPL, DTV, DISH
I also believe it’s going to be a waiting game. As much as I want it to, I don’t think the pop over $1 is going to happen anytime soon. But I DO believe it will slowly crawl it’s way up.
The thing that pisses me off is….HOW can it go lower? I can see a panic sell drop to .34 cents again….but all this talk of .25 cents or lower is kinda F’d up if you ask me. Maybe thats what the manipulators want…total panic and uncertainty.
But heres the thing, the LAST time Sirius was in the 20s was BACK IN FRIGGIN MARCH!!!! During the complete and utter economic meltdown and when Sirius had JUST come out of refinancing it’s debt.
HOW on earth could Sirius rationally trade back in the 20s again??? HOW?? After it continues to grow and improve? The debt is a NON issue for years. The car market is improving with Sirius making inroads into the used car market and restructuring more favorable deals with the likes of GM. Sirius is getting more and more upgrades and positive news.
The ONLY thing the bashers seem to be able to hang their hat on is the slight sub loss last quarter and what Mel already alluded to would be another sub hit THIS quarter. It’s like DUH! Hello??? McFLY???
We ALL know this before hand, and yet…despite all the good news and projections about increased EBIDA and the iphone app etc….the slight sub loss will be enough to knock us back down into the .20s??? A level we haven’t been at since the very HEIGHT of the economic meltdown when people were screaming DEPRESSION????
I am SORRY. It just doesn’t make ANY sense. It’s COO COO talk. And yet….people are freaking out. I can sense the panic. The bashers are actually winning again. It PISSES ME OFF.
My long position is safe. If these bozos couldn’t make me sell back when Sirius flirted with .05 cents and BK scares before the refinancing…there ain’t NO WAY they’re gonna scare me now.
Since then, I’ve managed to average down from my original share price of $6.50 from 4 years ago to just below $1.
I plan to average down again….so I’ll use this BULLSHIT scare tactic sell off as a buy in point. I’m thinking we’ll tease the low .30s….but I’d be SHOCKED if we break .30 for more than a nano-second.
I’m confident enough with the next few quarters going forward to feel good about buying on this dip. We’ve got 2 to 3 weeks till earnings, so I’ll wait and see how much panic selling these bozos manage to scare out of people. Still blows my mind. Being in this stock has been the most frustratingly insane experience ever. BUT the good thing is that I learned a lot from the experience. I feel I am wiser and a better investor and trader because of it.
Mostly, I look forward to the day when I can sell my initial investment for a nice profit. In the meantime, I will trade any further funds I throw into Sirius and play the volatility. I think it’s going to be a VERY bumpy few months until we see daylight creating many opportunities to trade the pops and drops. It’s like surfing. You sense the ocean. Right now I can feel the tide pulling out. I’m going to buy soon as I sense the pull back slowing down….because shortly after that the wave will come back, and it’ll be a nice one to ride.
Like I said, I think it’s going to sell off to the low .30s. I’d be SHOCKED if it goes lower. That would just be INSANE.
Good luck all.
I bet figures will be in line with expectations,no big surprise, some good new from APP&Co and from debit. At the end it will be a “solid” Quarter to build up the SIRI future. Latest Qx were a disaster, this is the first starting point for the “new born” SIRI.
I guess investors will recognize the stock value and NSS got enaugh to stop selling.
I predict a bull getting 1USD before the end of Q3 pointing to 3USD within YE.
I’m also pretty sure we will get some “bomb” (partnership/new ownership) that could make things even better. Do not forget this is the right time to buy/consolidate and SIRI is a good asset at a very discounted price.
Cheche
I agree with you Cheche. But the thing that nags me is WHY isn’t the big money buying this thing like crazy now? Haven’t they kept this stock down long enough to accumulate shares? I mean this is ridiculous. How much longer can they hold this stock down? Why the huge short increase? Just to buy in at lower prices? If this “BIG” news thats going to break this stock out to the upside is around the corner, Aren’t they playing a dangerous game of chicken cutting it so close?
Anyone watching Cramer right now? He has the CEO of MLB.COM and is SCREAMING how “Mobile Internet” apps are the FUTURE of investing. He’s going off on how HUGE it’ll be.
Of course no mention of Sirius. Lol. But this has to bode well for Sirius, and underscores the importance of their iphone app and how much they have to focus on the internet. And why I think it is IMPERATIVE that they attack Pandora and Slacker NOW by offering a similar feature on their iphone app. The sooner they steal back the internet thunder from them the better.
ANyway…going back to the MLB ceo on Cramer. It was an interesting segement. I’m not a baseball guy, I’m a football guy, but it was kinda cool. The MLB mobile internet service is $9.99 a month. Is this the reason why Sirius can’t offer Baseball or Football on the iphone app? Will they ever? Because I’d much rather pay Sirius and be able to listen to every game of ALL sports on my iphone than pay almost as much for video of the games for $9.99. Maybe die hard fans would pay for both. I dunno. But will Sirius ever be able to offer Baseball and Football on their iphone app? It’d be huge.
I don’t know if I’d like to WATCH a game on a small iphone screen. Perhaps my laptop…but not my iphone. On my iphone, I’d much rather listen to the game.
Thats it. Peace.
Nice article. I believe that when we do finally break $1 (maybe even before then), we are going to scream upwards. We just need to shake the shorts out of the tree. Once they go long and put the dollars behind it, this price is going to see a drastic increase. We are just wasting our time writing about this stuff now. We all know about the debt, the loss of subs, the bad auto market, HS not on the iphone, etc. I give it about 6-8 months time. From that point onwards, I bet this will be the true “roller coaster ride”, but this roller coaster will be going UP UP UP!
I’m just crossing my fingers that the stock gets to a price I can sell it at BEFORE the reverse stock split happens.
100% agree with u S4E
Gino:
Did you confirm somewhere that earnings are August 3? Bloomberg lists the earnings date as August 7?
At the time of his writing, the conference call was assumed to be sometime during the week of August 3rd. Since then, however, the conference call has been announced by Sirius XM as being on the 6th of August, at 8 am EST. Hope that helps.
– Newman
Thanks cheche…it is factual information and not speculation. This is the #1 shorted stock on the Nasdaq. So, if the position flips to long, no one wants to be left holding the bag. So, there will be a RUSH (like wind blowing through your hair on a roller coaster) of panic buying/covering. I can’t wait until we hit that day. It will be something to remember I’m sure.
S4E@Siri 4-eva
Agree to a point…The lent shares to the 2014 bonds amounts to I believe in the neighboorhood of 170M shares. Until Mel and Co remove the 2014 bonds…the Hedgies will/may cont to hold those shares short to protect their investment. However, they could also, go long and try to profit along the way! Take out the 2014 bonds…hold on to your ass…1.50-2.00 almost instantly!IHHO
Yes, they’ll survive, but after they unload their untenable debt in a bankruptcy filing. That’s why the stock price is where it is. It’s indicative of an 80% chance of bankruptcy. And I am not shorting it.