Sirius XM (SIRI) Rating Lowered to Sell at Zacks Investment Research

Sirius XM (NASDAQ:SIRI) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research note issued on Monday.

According to Zacks, “Sirius XM shares have underperformed the industry over the past year. The company faces intense competition in the streaming space from the likes of Apple and Spotify, which is expected to hurt the top line in the near term. Additionally, increasing royalty related expense is expected to keep margins under pressure. Moreover, slowdown in new car penetration due to reduced penetration in high fleet sales with a few automakers is also a concern. However, growth in subscriber base and higher average revenue per user (ARPU) aided fourth-quarter 2018 top line. The company’s subscriber base is witnessing growth owing to a strong content portfolio. Additionally, after Pandora acquisition, Sirius XM has more than 100 million listeners in North America. The acquisition is also expected to further boost its content slate, which is a positive.”

Several other analysts have also issued reports on SIRI. Pivotal Research reaffirmed a “hold” rating and issued a $7.00 target price on shares of Sirius XM in a research note on Thursday, January 31st. B. Riley reaffirmed a “buy” rating on shares of Sirius XM in a research note on Tuesday, January 29th. BidaskClub raised Sirius XM from a “sell” rating to a “hold” rating in a research note on Friday, November 2nd. Barclays set a $6.00 target price on Sirius XM and gave the stock a “sell” rating in a research note on Saturday, February 2nd. Finally, Buckingham Research raised Sirius XM from a “neutral” rating to a “buy” rating in a research note on Monday, January 28th. Four investment analysts have rated the stock with a sell rating, six have assigned a hold rating and six have assigned a buy rating to the company. Sirius XM presently has a consensus rating of “Hold” and an average price target of $7.19.

Shares of SIRI opened at $5.90 on Monday. The company has a market capitalization of $26.79 billion, a price-to-earnings ratio of 22.69, a PEG ratio of 2.34 and a beta of 1.04. Sirius XM has a 1 year low of $5.48 and a 1 year high of $7.70.

Sirius XM (NASDAQ:SIRI) last issued its earnings results on Wednesday, January 30th. The company reported $0.06 earnings per share (EPS) for the quarter, hitting the Thomson Reuters’ consensus estimate of $0.06. The business had revenue of $1.50 billion during the quarter, compared to analyst estimates of $1.48 billion. Sirius XM had a negative return on equity of 76.76% and a net margin of 20.38%. Sirius XM’s revenue for the quarter was up 6.6% on a year-over-year basis. During the same quarter in the prior year, the firm earned ($0.01) earnings per share. As a group, equities analysts expect that Sirius XM will post 0.22 EPS for the current year.

Sirius XM announced that its board has authorized a share repurchase plan on Tuesday, January 29th that authorizes the company to buyback $2.00 billion in shares. This buyback authorization authorizes the company to reacquire up to 7.7% of its shares through open market purchases. Shares buyback plans are usually an indication that the company’s board believes its stock is undervalued.

In other Sirius XM news, VP Thomas D. Barry sold 48,513 shares of the stock in a transaction on Tuesday, February 5th. The stock was sold at an average price of $6.06, for a total value of $293,988.78. Following the completion of the transaction, the vice president now owns 462,465 shares in the company, valued at $2,802,537.90. The transaction was disclosed in a filing with the SEC, which is available through the SEC website. Also, EVP Stephen Cook sold 56,118 shares of the stock in a transaction on Tuesday, February 5th. The stock was sold at an average price of $6.13, for a total value of $344,003.34. Following the completion of the transaction, the executive vice president now owns 1,445,007 shares of the company’s stock, valued at approximately $8,857,892.91. The disclosure for this sale can be found here. Corporate insiders own 0.76% of the company’s stock.

A number of institutional investors and hedge funds have recently bought and sold shares of SIRI. Next Capital Management LLC bought a new position in shares of Sirius XM during the fourth quarter valued at $197,000. Sound View Wealth Advisors LLC bought a new position in shares of Sirius XM during the fourth quarter valued at $57,000. Aptus Capital Advisors LLC bought a new position in shares of Sirius XM during the fourth quarter valued at $1,514,000. Nomura Asset Management Co. Ltd. increased its holdings in shares of Sirius XM by 8.5% during the fourth quarter. Nomura Asset Management Co. Ltd. now owns 326,189 shares of the company’s stock valued at $1,863,000 after acquiring an additional 25,441 shares in the last quarter. Finally, CIBC Asset Management Inc increased its holdings in shares of Sirius XM by 2.9% during the fourth quarter. CIBC Asset Management Inc now owns 418,579 shares of the company’s stock valued at $2,390,000 after acquiring an additional 11,689 shares in the last quarter. Institutional investors and hedge funds own 17.35% of the company’s stock.

Sirius XM Company Profile

Sirius XM Holdings Inc provides satellite radio services in the United States. The company broadcasts music plus sports, entertainment, comedy, talk, news, traffic, and weather programs, including various music genres ranging from rock, pop and hip-hop to country, dance, jazz, Latin, and classical; live play-by-play sports from principal leagues and colleges; multitude of talk and entertainment channels for various audiences; national, international, and financial news; and limited run channels.

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