Re: It\'s an old topic, but let\'s revive it. SIRIUS!!!
Right now, cable and satellite TV stocks are selling for 11x the present value of future subscriber fees.
There is clearly value if XMSR can significantly grow its subscriber base over time. But that is of course risky.
Bank of America is predicting positive +$700mm in annual free cash flow in 5 years so there is a business model here.
This stock is certainly not cheap... but I can envision upside if the company continues to exceed forecasts in terms of subscribers. They just announced an interesting strategy; give away 2 for 1 for fathers day and graduation... simultaneously, they hiked the monthly subscription price by 30%...
would you rather pay $13 per month or listen to lots of commercials?
The history of great growth stocks is that they continue to surprise on the upside. If they do, this stock is going up... if they don't this stock is way overvalued... you cannot say if this stock is a LONG or a SHORT without making a big prediction on future subscriber adds... it is that simple.
lately, this company has modestly exceeded subscriber projections. it got hit in April because of the problems at its partner (General Motors installs these things in lots of cars)... The stock will languish if they only slightly exceed subscriber forecasts. It will go up if subscriber forecasts are consistently exceeded.
stay tuned
|