Gabelli Hits Sirius XM Radio (SIRI) with a "Sell," Says Shares are Frothy
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Price: $3.54 --0%
Rating Summary:
10 Buy, 6 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 15 | Down: 15 | New: 29
Rating Summary:
10 Buy, 6 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 15 | Down: 15 | New: 29
Trade SIRI Now!
Gabelli is out with a brutal call on Sirius XM Radio (NASDAQ: SIRI) Tuesday morning, downgrading the satellite radio provider from Hold to Sell saying shares are priced for perfection.
The firm said with the 38 percent year-to-date run-up the stock price has outpaced the fundamentals. "We no longer see a margin of safety and expect SIRI shares to face meaningful trading headwinds in the near future," the analyst said. "We recommend investors Sell shares of Sirius."
Gabelli said they expect Liberty (NASDAQ: LMCA) will stop purchasing shares of SIRI once LCMA reaches the 50%+ ownership required to execute a RMT transaction. "This would remove a major buyer from the market; we estimate Liberty only needs another 75 million to gain control. Further, we expect a Liberty-SIRI RMT could 1) result in dilution for SIRI shareholders as LMCA negotiates a premium, and 2) unleash selling as LMCA holders sell some or all of the distributed SIRI shares."
The firm also said the stock is fully valued at 19x 2012E and 15x 2013P EBITDA and the highly speculated share repurchase program will create much less shareholder value with SIRI shares trading at $2.51.
For an analyst ratings summary and ratings history on Sirius XM Radio click here. For more ratings news on Sirius XM Radio click here.
Shares of Sirius XM Radio closed at $2.51 yesterday, with a 52 week range of $1.27-$2.64.
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The firm said with the 38 percent year-to-date run-up the stock price has outpaced the fundamentals. "We no longer see a margin of safety and expect SIRI shares to face meaningful trading headwinds in the near future," the analyst said. "We recommend investors Sell shares of Sirius."
Gabelli said they expect Liberty (NASDAQ: LMCA) will stop purchasing shares of SIRI once LCMA reaches the 50%+ ownership required to execute a RMT transaction. "This would remove a major buyer from the market; we estimate Liberty only needs another 75 million to gain control. Further, we expect a Liberty-SIRI RMT could 1) result in dilution for SIRI shareholders as LMCA negotiates a premium, and 2) unleash selling as LMCA holders sell some or all of the distributed SIRI shares."
The firm also said the stock is fully valued at 19x 2012E and 15x 2013P EBITDA and the highly speculated share repurchase program will create much less shareholder value with SIRI shares trading at $2.51.
For an analyst ratings summary and ratings history on Sirius XM Radio click here. For more ratings news on Sirius XM Radio click here.
Shares of Sirius XM Radio closed at $2.51 yesterday, with a 52 week range of $1.27-$2.64.
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Fothy
I think Gabelli has been spending way too much time at Starbucks
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Siri - Liberty
jjm on Sep 11, 2012 10:27 AMMark as Spam | Reply to this comment
What is Gabelli's connection with liberty.