Stock Preacher

Sirius XM Radio Inc. (NASDAQ: SIRI)

Sirius XM Radio Inc. (SIRI) is an American satellite radio broadcaster, offering its services for a subscription fee through its satellite radio systems, the SIRIUS system and the XM system.  It offers a programming lineup of 117 channels to subscribers, which include 63 channels of commercial-free music and 54 channels of sports, news, talk, entertainment, and traffic and weather. In addition, it provides music channels that offer music genres, ranging from rock, pop and hip-hop to country, dance, jazz, Latin and classical; channels of sports; talk and entertainment channels; comedy channels; and religious channels. On July 28, 2008, its wholly owned subsidiary, Vernon Merger Corp., merged with and into XM Satellite Radio Holdings Inc. and, as a result, XM Satellite Radio Holdings Inc. became its wholly owned subsidiary.

SIRI was formerly known as Sirius Satellite Radio Inc. and changed its name to Sirius XM Radio Inc. in August 2008. Sirius XM Radio Inc. was founded in 1990 and is headquartered in New York, New York.

Share Statistics (17-Dec-09)					FY 2007		FY 2008		% Chg		Q3 2008		Q3 2009		% Chg
Symbol	SIRI	Revenue, $Mn		922.07		1,663.99		80.46%		488.44		618.66		-9.96%
Current price	$0.60	Gross marg.		40.36		40.11		-25 b.p.		44.24%		56.86%		1,262 b.p.
52wk Range:	0.05-0.78	Oper. margin		–		-11.18		–		-308.59%		-11.59%		29,700 b.p.
Avg Vol (3m):	26,454,200	Net margin		-61.30		-319.31		-25,801		-998.98%		-24.12		97,486 b.p.
Market Cap.	2.32B
Dil. Shares Outst.	3.86B	EPS, $		-0.39		-0.99		153.85%		-0.71		-0.02		-97.18

Source: Reuters.com, SEC Filings

Financial Summary

Year on year, SIRI’s net income fell 839.99%, from a loss of $565.25 million to a larger loss of $5.31 billion, despite revenues that grew 80.46% from $922.07 million to $1.66 billion over the same period.

Last year, the Company’s cash reserves declined by $58.37 million. However, Cash Flow from Investing totaled $728.43 million, indicating SIRI has earned more from the sale of existing assets than it spent on the purchase of new assets. In addition the company used $152.80 million for operations while cash used for financing totaled $634 million.  SIRI has a Debt to Total Capital ratio of 1.00%, a lower figure than the previous year’s 177.79%.

Source: markets.ft.com

Financial Strength

	Company	Industry	Sector	S&P 500
Quick Ratio (MRQ)	0.39	1.89	0.34	0.93
Current Ratio (MRQ)	0.40	2.07	0.42	1.10
LT Debt to Equity (MRQ)	41,073.25	100.44	16.65	123.98
Total Debt to Equity (MRQ)	45,667.63	112.74	27.28	184.11
Interest Coverage (TTM)	-45.70	1.09	0.05	25.42

Analyst Consensus

Analysts polled by Thomson Reuters rate shares of SIRI a “Hold.”

Analyst Recommendations and Revisions

1-5 Linear Scale	Current	1 Month Ago	2 Month Ago	3 Month Ago
(1) BUY	0	0	0	0
(2) OUTPERFORM	2	2	1	1
(3) HOLD	3	3	3	3
(4) UNDERPERFORM	0	0	0	0
(5) SELL	0	0	0	0
No Opinion	0	0	0	0
Mean Rating	2.60	2.60	2.75	2.75S

Source: http://www.reuters.com/finance/stocks/analyst?symbol=SIRI.O

	# of Estimates	Mean	High	Low	1 Year Ago
SALES (in millions)
Quarter Ending Dec-09	3	645.20	662.59	634.00	684.20
Quarter Ending Mar-10	2	667.59	683.18	652.00	–
Year Ending Dec-09	3	2,488.14	2,505.52	2,476.90	2,701.64
Year Ending Dec-10	3	2,760.36	2,879.88	2,683.00	2,774.77
EARNINGS (per share)
Quarter Ending Dec-09	4	-0.02	-0.01	-0.03	-0.03
Quarter Ending Mar-10	3	-0.01	0.00	-0.02	–
Year Ending Dec-09	4	-0.12	-0.10	-0.14	-0.16
Year Ending Dec-10	4	-0.01	0.03	-0.03	-0.06

Source: http://stockpreacher.com/2009/11/06/technical-trading-review-for-sirius-xm-radio-inc-siri/

Investment Highlights

SIRI has two principal wholly owned subsidiaries, XM Satellite Radio Holdings Inc. and Satellite CD Radio Inc. The Company is engaged in broadcasting in the United States, its music, sports, news, talk, entertainment, traffic and weather channels for a subscription fee through its satellite radio systems, the SIRIUS system and the XM system.

The Company has content relationships with an array of personalities and artists, including Howard Stern, Martha Stewart, Oprah Winfrey, Rosie O’Donnell, Jamie Foxx, Barbara Walters, Opie & Anthony, Bubba the Love Sponge®, Bob Edwards, Chris “Mad Dog” Russo, Jimmy Buffett, The Grateful Dead, Willie Nelson, Bob Dylan and Tom Petty.

SIRI is the leader in sports programming as the Official Satellite Radio Partner of the NFL, Major League Baseball®, NASCAR®, NBA, NHL®, and PGA TOUR® and major college sports.  Recently, the Company announced it will broadcast an extensive lineup of college bowl games throughout the 2009-10 college football postseason.  SIRI’s coverage features live play-by-play of 25 games including the Rose Bowl, Allstate Sugar Bowl, Tostitos Fiesta Bowl, FedEx Orange Bowl and the Citi BCS National Championship game.

The Company has arrangements with every major automaker. Its products are available at shop.sirius.com and shop.xmradio.com, and at retail locations nationwide, including Best Buy, RadioShack, Wal-Mart and independent retailers.  It also offers SIRIUS Backseat TV, the first ever live in-vehicle rear seat entertainment featuring Nickelodeon, Disney Channel and Cartoon Network; XM NavTraffic® service for GPS navigation systems delivers real-time traffic information, including accidents and road construction, for more than 80 North American markets.

The SIRIUS system consists of three in-orbit satellites, approximately 120 terrestrial repeaters that receive and retransmit signals, satellite uplink facilities and studios. The XM system consists of four in-orbit satellites, over 700 terrestrial repeaters that receive and retransmit signals, satellite uplink facilities and studios.

At June 30, 2009, SIRI had 18,413,435 subscribers, representing a decline of 163,395 subscribers, or 1%, from the 18,576,830 subscribers as of June 30, 2008. According to the report, the decline in subscriber growth was principally the result of 755,659 fewer gross paid promotional trial additions due to the decline in North American auto sales. This decline was partially offset by an increase of 592,264 in self pay subscribers compared to June 30, 2008. Gross subscriber additions decreased approximately 35% during the three and six months ended June 30, 2009, compared to the three and six months ended June 30, 2008.

Recent Developments

Last September, the Company announced SIRIUS FM-5, the newest addition to the SIRIUS XM satellite fleet, was placed into service on the SIRIUS network, providing improved signal penetration and reception to millions of SIRIUS subscribers nationwide. FM-5 is now fully operational and broadcasting SIRIUS XM programming and data services to SIRIUS radios in North America.

In November, S&P’s ratings services lifted SIRI’s credit rating outlook to Positive from Stable, indicating that the Company’s rating may be lifted over the next six months to two years. In addition, S&P affirmed the Company’s B- corporate credit rating. This rating covers the company’s overall creditworthiness and means SIRI currently can meet its financial obligations.

The credit ratings agency said SIRI’s profitability has improved, as measured by discretionary cash flow and earnings before interest, taxes, depreciation and amortization, noting that the company was able to save money from integrating XM Satellite Radio Holdings Inc., which had similar operations.

As of November, SIRIUS XM’s credit rating remains in “junk” bond category, reflecting high debt leverage and dependence on U.S. auto sales, which have been weak.

Source:  SIRIUS XM Radio

Technical Analysis

Source: http://stockcharts.com/h-sc/ui

SIRI is below its 13 day moving average. This bearish sign is even more significant because the moving average is also trending lower.

SIRI has been relatively stable recently. This is evidenced by the width of its Bollinger Bands which are tighter than normal. Additionally,  SIRI is trading within its Bollinger Bands. This is a normal condition and suggests that the stock is neither overbought nor oversold relative to the recent price action.

The MACD for SIRI currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9day moving average. Second, the MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower.

As of last close on Dec. 17 2009, SIRI closed at $0.6009, 22.92% below its 52-week high of $0.7796, set on August 21, 2009.

Comparative Analysis

Company Name	Ticker	Price per	Mrkt. Cap.	P/E		P/S
Dec-17-2009	symbol	Share, $	$ Mn	2009	2010	2009	2010
Westwood One Inc.	WWON	5.00	101.56	n/a	n/a	n/a	0.25
Radio One Inc.	ROIAK	3.20	175.13	n/a	n/a	0.64	0.65
Entercom Communications Corp.	ETM	6.90	243.51	8.73	6.83	0.65	0.62
Cumulus Media Inc.	CMLS	2.14	89.09	n/a	n/a	0.36	0.38
Emmis Communications Corp.	EMMS	1.25	46.19	n/a	n/a	0.14	0.15
Salem Communications Corp.	SALM	4.49	106.39	n/a	n/a	0.49	0.55
Corus Entertainment Inc.	CJR	17.55	1,410	11.62	11.04	1.81	1.73
Median						0.57	0.55
Sirius XM Radio Inc.	SIRI	0.60	2,320	n/a	n/a	0.93	0.83

Source: Thomson Financial

Insider Trading Activity

NET SHARES PURCHSE ACTIVITY Inside Purchases – Last 6 Months
	Shares	Transaction
Purchases	n/a	0
Sales	8,975,700	45
Net Shares Purchased (Sold)	(8,975,700)	45
Total Insider Shares Held	64.43M	n/a
% Net Shares Purchased (Sold)	(12.2%)	n/a

Net Institutional Purchases — Prior Qtr to Latest Qtr
	Shares
Net Shares Purchased (Sold)	(372,276,000)
% Change in Institutional Shares Held	(90.6)

Source: Yahoo Finance

DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority.  We are neither licensed nor qualified to provide investment advice.

The information contained in our report should be viewed as commercial advertisement and is not intended to be investment advice.  The report is not provided to any particular individual with a view toward their individual circumstances. The information contained in our report is not an offer to buy or sell securities.  We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company.  An individual should never invest in the securities of any of the companies profiled based solely on information contained in our report.  Individuals should assume that all information contained in the report about profiled companies is not trustworthy unless verified by their own independent research.

Any individual who chooses to invest in any securities should do so with caution.  Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested.  Always research your own investments and consult with a registered investment advisor or licensed stock broker before investing.

Information contained in our report will contain “forward looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934.  Subscribers are cautioned not to place undue reliance upon these forward looking statements.  These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated.  Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC.  You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements.

We are committed to providing factual information on the companies that are profiled.  However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions.  We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so.  Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable.

To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in the report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss of opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information).

We encourage you to invest carefully and read investment information available at the websites of the SEC at http://www.sec.gov and FINRA at http://www.finra.org.

Popularity: 1% [?]