Deal or no deal, Goldman says "sell XM" - Orbitcast

Deal or no deal, Goldman says "sell XM"

| 135 Comments

XMSRWhether or not the merger with Sirius goes through, Goldman Sachs analyst Mark Wienkes still doesn't like XM, and downgraded shares of XM Satellite Radio Holdings Inc. from Neutral to Sell this morning.

"We could be wrong in the near-term, if the DOJ approves the proposed merger," says Wienkes. “That said, our downgrade is valuation based and contemplates possible short-term price swings whether the DOJ approves or rejects."

"Deal or no deal, we think the current valuation incorporates a view too close to optimal, e.g. DOJ and FCC approvals with few conditions and subsequently, near-certain realization of all potential synergies,” added Wienkes.

Bottom line: “With the majority of the upside baked in, we recommend investors sell XMSR.”

And what about Sirius? Pretty much just like XM, only worse, says Winkes: "In our view, SIRI (Sell) shares are subject to the same merger issues as XMSR shares coupled with a less favorable business model and trends."

[Barrons, Silicon Alley Insider]

135 Comments

He waits till now to say that????

looking only at the bottom lines of each earnings (loss) report, he is not wrong. unfourtunatly like so many ANALists out there, they do not get any deeper in to the reports. He is quick enough to realize Sirius is worse off than XM. Got to give him credit there. But a sell rating on both? I just Dunno.

Sirius is worse off than XM?

Look again XM does not even own two good satellites and gives GM half the sub. money.

And XM is wasting money on those hack jocks that nobody even listens to, while Sirius has QUALITY CONTENT that costs money for, like Howard and Bubba. Not sure how Sirius is worse off. They are the ones buying up XM after all. Can't wait for the announcement that the bbbbboys are relegated to the Synergy column and get the boot out the door. Hopefully it happens the day the CBS deal dies, so all 20 of the pests will never hear their zeroes on the radio.

>> XM does not even own two good satellites

Where do you people keep getting this nonsense? XM's satellite are brand new, and they have two functioning older satellites as in-orbit spares.

Sirius is scheduled to launch two replacements over the coming two years as a start on replacing its aging fleet.

"Look again XM does not even own two good satellites"

What are you talking about? XM has two fully functional satellites and two orbital spares.

>>> Not sure how Sirius is worse off. They are the ones buying up XM after all.

If they were buying XM with money that would be one thing.

But doubling the outstanding share count (based on the added value of XM as a net asset) is hardly what you would call "buying".

The transaction is Sirius shareholders giving up half their equity in Sirius in exchange for half the equity in XM. Not sure what it is, but I know what it isn't -- it isn't Sirius "buying up" XM.

Tick, Tick, Tick...Tired of this merger being an issue of greater importance than national security.

OK Steriots.. go pull the last finantial report.
#1 How mush did Sirius write down their system and how much did XM?
SIRI_____________ XMSR____________
#2 When do sirius's debt payments begin comming due and how much
2008
2009
2010
2011
2012
#3 whats XM's debt Scedule for the same years?
#4 Provide the subscriber numbers directly artibuted to Stern and divide by total contract value, Do the same for O&A... who is more expensive per subscriber?
#5 Do the Same for NFL, NHL, NBA, and so on. Whats that? you never did this sort of thing? Shame on you.
#6 provide the OEM take rate for Sirius. What? its not published or even disclosed by Sirius? Why not?
#7 What % of Sirius shares voted for the merger. (Note* do not provide the % of votes submitted)
#8 Provide the Retail Net for Sirus in Q3 2007.


One last note, I have nothing against stern and I know he has paid for himself at sirius, this is not the argument, I Know O&A's poor ratings, this is not the argument either.

that Sirius is 'buying' XM is a ludicris proposition.
Sirius has vastly OVERPAID for their 'Talent' like Howard
Stern, et al. The return of subscribers brought in by
the over priced talent does not even begin to cover
the cost of the talent.
Sirius has made some very egregious business
decisiions and deals.
XM has a better business model and more
conservative business approach and more
than double the actual subscribers that Sirius has.
(Sirius counts unsold vehicles in dealer inventory
as 'subscribers' because they contain Sirius
equipment).
XM should keep running their own ship, wait for
Sirius to sink, and then pick up the flotsom
that they want from the leftovers.

XM owns only ONE good satellite the other XM 4 was leased back.

Do not be fooled by XM sub numbers half the sub money for GM cars goes to GM.

Do the math over $60 a year goes to GM for each car subed to XM.

Nobody talks about that but they sure talk about what Howard gets.

that Sirius is 'buying' XM is a ludicris proposition.
Sirius has vastly OVERPAID for their 'Talent' like Howard
Stern, et al. The return of subscribers brought in by
the over priced talent does not even begin to cover
the cost of the talent.
Sirius has made some very egregious business
decisiions and deals.
XM has a better business model and more
conservative business approach and more
than double the actual subscribers that Sirius has.
(Sirius counts unsold vehicles in dealer inventory
as 'subscribers' because they contain Sirius
equipment).
XM should keep running their own ship, wait for
Sirius to sink, and then pick up the flotsom
that they want from the leftovers.

Why does Anonymous Troll this Blog?

He is a typical Stern Fag that only cares that any other radio personality that can actually knock Stern off his self-proclaimed King status is silenced.

O&A have a huge following on XM...dont dilute yourself. And what is funny is that everytime one of these Trolls comes up with the 0.0 or clones comments, that they are on their way out blah blah blah...Hmmm...THEY ARE STILL HERE!!!!!

Face it Stern Fag....The bbbboys arent going anywhere and you & stern will have to figure out a way to co-exist. Mel may love Howard...but he loves money more. And once he and all the other Sirius Brass see the numbers....O&A are going to stay

Take your head out of your ass...the product has value and they have listeners...

THE END!!!!

To Marcus, di·lute /dɪˈlut, daɪ-; adj. also ˈdaɪlut/ Pronunciation Key - Show Spelled Pronunciation[di-loot, dahy-; adj. also -dahy-loot] Pronunciation Key - Show IPA Pronunciation verb, -lut·ed, -lut·ing, adjective
–verb (used with object) 1. to make (a liquid) thinner or weaker by the addition of water or the like
de·lude /dɪˈlud/ Pronunciation Key - Show Spelled Pronunciation[di-lood] Pronunciation Key - Show IPA Pronunciation
–verb (used with object), -lud·ed, -lud·ing. 1. to mislead the mind or judgment


To Marcus, di·lute /dɪˈlut, daɪ-; adj. also ˈdaɪlut/ Pronunciation Key - Show Spelled Pronunciation[di-loot, dahy-; adj. also -dahy-loot] Pronunciation Key - Show IPA Pronunciation verb, -lut·ed, -lut·ing, adjective
–verb (used with object) 1. to make (a liquid) thinner or weaker by the addition of water or the like
de·lude /dɪˈlud/ Pronunciation Key - Show Spelled Pronunciation[di-lood] Pronunciation Key - Show IPA Pronunciation
–verb (used with object), -lud·ed, -lud·ing. 1. to mislead the mind or judgment


To Marcus, di·lute /dɪˈlut, daɪ-; adj. also ˈdaɪlut/ Pronunciation Key - Show Spelled Pronunciation[di-loot, dahy-; adj. also -dahy-loot] Pronunciation Key - Show IPA Pronunciation verb, -lut·ed, -lut·ing, adjective
–verb (used with object) 1. to make (a liquid) thinner or weaker by the addition of water or the like
de·lude /dɪˈlud/ Pronunciation Key - Show Spelled Pronunciation[di-lood] Pronunciation Key - Show IPA Pronunciation
–verb (used with object), -lud·ed, -lud·ing. 1. to mislead the mind or judgment


We have already seen the numbers, courtesy of Arbitron, and 0.0 have NOBODY listening to them on XM. They get paid millions to entertain a couple thousand listeners a week. Howard gets paid millions and brought MILLIONS to Sirius and has millions who tune in every day. Greg and Tony brought nobody and nobody listens. If a hack shock jock falls in the middle of the woods, does anybody hear or care? Didn't think so.

0.0

Ew, at these stupid sirius fans.

I really hope the merger passes that way i can find something else to love and not listen to these dumbfucks.

Sell Sell Sell all sat. radio stock.

Sirius is in debt and with the merger will take xm with it.

in a few years better technology will replace sat. radio. and Mel will be stuck with a failed business.

Now that we've gotten our English lesson for the day, let's face facts. Yes, O & A's numbers on Terestrial radio have been less than steller of late. and this is coming from a fan of theirs...I can admit when they have a problem and if I don't like something they do i'll talk about it. As for XM, we've been through all this before. The surveys were taken at a time when Opie and Anthony weren't even on the air during their 30 day suspention from XM, when 202 was essentially the Ron and Fez channel. So if you asked someone the question, do you listen to O & Aon XM? The answer would have to be no, since they weren't even on the air. So of course the numbers would appear lower than they are. As far as channels go, 202 is in the top 5 most listened to stations on the platform, despite it having an XL designation. That's impressive. All I know is that if the murger goes through, it doesn't mean bye bye for O & A since they signed a contract to be with XM until 2010. So unless something major happens in the wake of the murger and their contracts get bought out, I'm afraid you Howard fans will be stuck with them. and really why should you give a flying fuck anyways? If the boys are such 0.0's, and Howard is so great, why take such pleasure in bashing them as you do? If they were nothing, wouldn't you just write them off as hacks and move on to Howard and never mention them again? But you don't, whenever they're mentioned here, whose the first to post about them? Yep? That's right, Stern Zombies...

John said "XM owns only ONE good satellite the other XM 4 was leased back."

unforrtunatly he missed XM 1 and XM 2 as well as All of XM4 minus the transponder. what will be really interesting is who it was sold to.

GM revenue share, sure, As if tere was Zero in subsadized costs for a Sirius receiver going in to a Chrysler or a ford car/truck. The deals are more simmilar than you think.
Also, XM's revenue share with GM is capped at a specific number of subscribers. For shrysler to get the money from sirius all they have to do is put the receiver in. There is little incentive after that.

What are all you talking about???

Sirius has grown 4 times faster than XM. Y'all argue that Sirius overpaid for talent? Well, its that "talent" that helped Sirius nearly catch up to XM in numbers of subs. They went from 1 million to 7 million. Sirius was voted the FASTEST growing company recently.

Its XM that NEEDS Sirius. If it weren't for this merger, XM would be the one facing bankruptcy.

Haven't you all been READING the reports? :-)

@Frigginregan

Uh, the fanboy shit is old and tired. I got news for you ace, if there isn't a merger BOTH of these companies are on the fast track to bankruptcy.

I am not exactly pro-merger, but I do realize that without it we would quite likely have neither service in the coming few years.

I'm gay.

Me too!

Sirius has grown 4 times faster than XM. Y'all argue that Sirius overpaid for talent? Well, its that "talent" that helped Sirius nearly catch up to XM in numbers of subs.
========================================================================
The OEM deal with Chrysler adds subs faster cause they do not churn out for 15-16 months as oppsed to 3 months. Remove the overlap and both XM and sirius have been growing EXACTLY the same for the last 6 months. Prior to that there was a residule stern effect. XM does not need Sirius, XM is slightly better off than Sirius. BOTH Companies need to cut Expenses. PERIOD

@Marcus

Then the 16 million Dish subscribers count for Sirius because they have the same deal.

Sirius counts Chrysler cars sitting on the lot because they are paid for the sub when the car hits the lot. They book the revenue incrementally over the term of the subscription but the radio is active from day one. I have been test driving different Jeeps and all of the radios in the 4 or 5 that I ahve been in were active.

XM's deal with GM is different. I've test driven 2 GM vehicles in the last 6 weeks and both sales weasels told me that the radio gets activated when you buy the car. Neither was active for the test drive.

I am really not sure about the english lesson that stern fag was trying to give....

Anyhow, your Arbitron argument? XM DOESNT RELEASE NUMBERS FOR THIER CHANNELS!!! I dont really care if they did a " informal " survey or not...Until I read something with XM Letterhead on it regarding XM 202 & the numbers...you can you fuck yourself! Arbitron...they are about as useful as Neilson or whatever that company is that does the survey for TV programs....its biased! Until you can get a clear picture of what people actually listen or watch, then your data is going to be wrong.

Once the dust on this merger settles we will see who is beating who in the ratings my friend...are you even taking DirecTV subs as potential Numbers? Cause if you go by Sirius Sat Radio logic, even a car sitting on the lot unsold is a sub number. With that said...how many DirecTV subs are there? Take that number and add them to XM listener base and take those who listen to XM 202 also.

Your argument is shit...Howard Stern is shit...and you are shit....

I agree with Stack Pointer.

How does this always turn into a Stern vs. Opie & Anthony argument? Guess what? There is more to satellite radio then Opie & Anthony and Howard Stern. Both are irrelevant to most people. Stern sucks, Opie & Anthony suck. We get it! It's boring already! Get a life already instead of arguing about ridiculous radio shows.

>>>How does this always turn into a Stern vs. Opie & Anthony argument?

I agree.

I say we turn it into a Martha vs. Oprah argument. Oprah's got Dr. Maya Angelou, bee-yotch! Martha is weak sauce!

"Get a life already instead of arguing about ridiculous radio shows."
I've been writing this very thing in the comments section for God knows how long and it doesn't help. Face it, we have people who are here for the express purpose of constantly talking about these 2 radio programs that about oh, 95% of Satellite radio listeners could give half a shit about. To these individuals, when you buy a Sirius, the only 2 channels that really matter are Howard 100, and Howard 101, and 202 is the only channel on xm. But there are hundreds of other channels to listen to. Flip around for a while. Listen to something else. A steady diet of Howard and/or O & A has prooven to drop the IQ level of the average person here to 0.0.

>>> Sirius counts Chrysler cars sitting on the lot because they are paid for the sub when the car hits the lot. They book the revenue incrementally over the term of the subscription but the radio is active from day one.

So, if a car on average takes 120 days from the date of manufacture until the date of sale, Sirius counts a "subscriber" for 1.333 years on its promo deal but only gets paid for 1.000 years worth of service.

You think, from a reporting perspective, that's okay? YOu think it is okay that Sirius overstates its subscriber count by some 11% (more importantly, how much have they REALLY outperformed XM in subscriber growth since Stern was hired?).

It is just bogus, lying, bullshit. Everyone had better get used to it because after the merger there will be no truth in reporting from The Satellite Radio Company.

This whole Sirius vs XM fanboy crap is really getting old. And to that idiot up there that keeps saying XM has only two satellites, at least check your facts before shooting off your mouth.

There are 4 XM satellites (2 are spares):
XM-1: Roll
XM-2: Rock
XM-3: Rhythm
XM-4: Blues

http://www.sat-index.com/catsearch.php?init=X

0.0

we miss you o&a

>>0.0
>>we miss you o&a
>>Posted by: Las Vegas FM Radio

Check the AM dial...that's where the good radio is. Howard is on....HOW many stations again?!?

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