Hey Surf, Great day for a great pick for a great picker. I hope it gets to your target and I wish you a happy new year!!
a friend of mine is long a few thou from fig 2 spot 17 now that it is over 3 he refuses to place trailing stop or even sell some to lock in gains .... he does not read this thread ... any real thoughts on what might be expected tomm , friday and into SIRI 's next sub report period which is rumored to be by mid jan how can one get a feel for if shorts have covered ? how can one get a feel for if the move is over for now or if we see 4 before 2 ?
I am not so sure the fundamentals for SIRI are as rosy as you guys make them out to be. I have been a subscriber and have followed the stock since last April. They need 2 million subscribers to reach break even and right now Q4 estimates are 250k, down from 330k they had estimated mid-year. The future is bright for this industry and they will probably make it (the product is great), but I have to think there is a lot of speculation in the price right now and a great Q4 also priced in. Remember there are almost 1 billion shares outstanding and they disappointed with Q3 results. I believe they have enough cash to make it to the end of 05 right now. I am curious what you guys who also follow this stock believe the market cap of SIRI will be when they achieve break-even. I do hope they make it, I think they have a far better product than XMSR.
As for fundamentals, what you have to grasp is that the business model will change as they start decimating the traditional attennae-based radio broadcast industry. Eventually XMSR and SIRI could replace this entire industry, and at a much lower cost base at that. And make no mistake, at some point they will also be offering free broadcast services w/ advertising - advertising that they will be able to sell at a significant premium to today's radio rates. So anyway, to simply look at today's fundamentals and conclude they need X subscribers to break even is misguided. Is Amazon breaking even yet? How many years did it take? What is their market cap? I think the attractiveness of the SIRI/XMSR business model is on par w/ Amazon. It is also reassuring that so many will not 'buy in' to this until it is already apparent. To make real money you have to have a vision about what is to come and then put your chips on the table.
I dont think its misguided to say they need 2 million subscribers to break even.. because its true! I am sure Sirius will suceed because they have a great product (if you own the stock and done subscribe.. sell 100 shares and use it to get a subscribtion!), they have a lot of exclusive deals, and have enough cash to make it till the end of 05. I just dont want to say they have great fundamentals right NOW. They are a great speculative stock though because, like you said, they have a sound business model and are starting to get some brand recognition. I am not sure they will decimate local radio stations... there will always be an audience for free radio, but theres a huge audience for sat radio and this is just the tip of the iceberg in terms of who will subscribe.