Is Sirius XM Headed the Way of Old Radio?
Remember when shares of Sirius and XM radio were the talk of Wall Street only a few years ago? The next generation of radio that will take over every car, home and local business? Fast forward to today, and only a couple of months after the July merger and shares of the combined company Sirius XM (SIRI) are trading at less than a dollar! The merger was supposed to inject confidence in investors, but the stock has dropped by more than 40% since July (click chart to enlarge). Last week, the company announced that subscriber growth will be slower than analysts expect. CEO Mel Karmazin, who was instrumental in signing top media names for Sirius radio’s lineup, such as Howard Stern and Martha Stewart, also had a hand in fueling the downward pull on share price after he made an “off-handed” comment regarding the large amount of debt due in February which the company is trying to negotiate. “Am I going to lend the company the money? I hope not. I hope we don’t get to that”. He later explained
