![]() Sirius XM's business has always been at the mercy of the auto industry. The combination of softening auto sales and rising capital expenditures on Sirius XM's end in launching new satellites have left him cautious about the company's near-term prospects. JPMorgan analyst Sebastiano Petti downgraded Sirius XM late last week, shifting to a neutral stance on the stock. The stock was trading slightly higher year to date at the end of 2021's first half, but the momentum shifted as COVID-19 cases started to spike again due to the Delta surge and new car sales slipped due to supply chain issues. One caveat here, though, is that revenue had a rare decline of 5% in the second quarter of last year, but we're still looking at nearly 10% growth from where it was in Q2 2019. The 15% year-over-year increase in revenue that it posted in the second quarter was its strongest organic uptick in more than a decade. Let's look at what has happened so far, and consider what it would take for Sirius to start a new winning streak before the end of 2021. Now it's close to getting back into positive territory, but it was still trading 4% lower in 2021 through Tuesday's close, even adjusted for its quarterly distributions. Sirius XM has been up and down all year - but in the losing category more often than not. ![]() The company's growth did accelerate compared to its depressed 2020 results, but that apparently hasn't been enough to impress the market. It wasn't.Ĭar sales have started to slow again after an initial pop in the first half of this year. ![]() It should've been a roll call of reactivated subscriptions and new car sales. Folks were getting out of the house again, and getting back into their cars where satellite radio is largely consumed. Sirius XM seemed like a no-brainer play on the recovery from the COVID-19 crisis. ![]() It's now working on its second consecutive year of negative shareholder returns. One of the more surprising winning streaks on Wall Street - Sirius XM Holdings ( SIRI 0.47%) delivering 11 consecutive years of positive shareholder returns - came to an end in 2020 when the stock took a 9% (dividend-adjusted) hit. ![]()
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