First time poster here on Investor Hub. Checking out other boards, the Yahoo board is just filled with bashers and pumpers both out of touch with the markets and reality. Same handle over there if you wanted to check any of my posting history.
Sirius XM started the year with guidance of 500,000 new subs for 2010 and 550 million in income from operations (aka EBITDA). On May 17, 2010 (http://investor.sirius.com/releasedetail.cfm?ReleaseID=470198 ) Sirius bumped its guidance to 750,000 subs for 2010 and IFO to 575 Million, and free cash flow of 100 million after the 1st quarter numbers blew out the projections. In a pre announcement on July 7, 2010 ( http://investor.sirius.com/releasedetail.cfm?ReleaseID=485479 ) Sirius came out and upped the guidance again after the 2Q results blew out the numbers yet again. They blew right through the second guidance numbers "In the first half of this year, SIRIUS XM added 754,690 net subscribers". Guidance was upped for a third time to 1.1 million subscriber growth for 2010. The unknown is the SAC (Subscriber Acquisition Costs), many believe that the added cost from these new subs will cut into the numbers in a negative way. However, you have to remember that Mel stated that with costs down and SAC managed well, 70% of the new subscribers revenue would fall to the bottom line (Paraphrased).
Auto sales numbers have been coming out and even with the slowdown in June it appears we will be over the 12 million unit mark for the entire year. Keep in mind Mel stated that Sirius could execute its plan with a little over 10 million auto sales. Also remember we are now in over 50% of the vehicles now hitting the market.
With all of this great news, news that in the normal world would send a stocks price through the roof, we are down and continue to be smashed down by short sellers, traders and FTD's (Failure to Deliver's aka Naked Shorts). Short interest last reported was over 227 million shares ( http://www.nasdaq.com/aspxcontent/shortinterests.aspx?symbol=SIRI&selected=SIRI )and again those are only the DTCC reported shorts.
If you are long hold tight, if you are looking to get long use the big dips to scale into the stock. If you are short watch your margins closely and don't get to greedy, eventually this stock is going to go up. Once it has proven itself it will become a Wall Street darling again.
Position Disclosure: Long
Sentiment: Strong Buy