24/7 Wall St. » SIRI

Sirius XM Outlines More Growth for 2013, out to 2016-2018, at Annual Meeting

Jon C. Ogg — Tue, 21 May 2013 13:50:18 +0000

Sirius XM Radio Inc. (NASDAQ: SIRI) has some new forecasts for 2013. CEO James Meyer spoke to the company’s stockholders at the Sirius XM 2013 annual shareholders meeting on Tuesday. The satellite radio giant already guided numbers up for 2013, and now have more growth expected in 2013.

Sirius XM ended 2012 with 23.9 million users and ended the first quarter with 24.4 million users. Today’s projection is to end the year with roughly 25.3 million subscribers.

If you want to know just how much difference the company sees between it and Pandora Media Inc. (NYSE: P) and terrestrial radio, the numbers are rather stark. Sirius XM showed $142.34 in revenue per subscriber in 2012. That compares to only $6.51 per active Pandora user and $12.91 per Clear Channel listener.

A driving force, no pun intended, is new car sales. Sirius XM says that of the 14.5 million new cars sold in 2012 the company had 67% penetration in them. The forecast used to derive the higher subscriber numbers appears to be based on expected car sales growth. The company used projections of 15.3 million new cars sold in 2013 and 15.9 million in 2014. From 2015 to 2017 it used 16.3 million cars on a static basis per year. Sirius even sees more than 100 million Sirius XM-enabled vehicles in operation in 2017 to 2018.

Financial guidance for 2013 calls for revenue of more than $3.7 billion, although we would point out that Thomson Reuters already has a consensus estimate of $3.79 billion and the street-high estimate is $3.86 billion. The company sees 2013 EBITDA above $1.1 billion and free cash flows of about $915 million. The self-pay net subscriber additions are put at about 1.6 million, and total net subscriber additions are targeted to be about 1.4 million.

Out of the company’s $2 billion stock buyback plan, Sirius XM said that it has repurchased a total of 209 million shares as of April 26. Its special dividend of $0.05 at the end of 2012 also came to a $327 million total payout to its shareholders.

Sirius XM shares are up two cents at $3.52, against a 52-week trading range of $1.80 to $3.59. Its market capitalization is currently listed as $22.4 billion.

FULL SIRIUS XM SLIDE SHOW

Filed under: Investing Tagged: P, SIRI

24/7 Wall St. Closing Bell — Wednesday: Markets Cannot Shake-off Low Open and Sink to Close

Paul Ausick — Wed, 01 May 2013 20:08:40 +0000

U.S. equity markets opened lower this morning following a weaker-than-expected employment report from ADP and concern that Friday’s report from the Bureau of Labor Statistics will follow the ADP lead (more coverage here). In other U.S. data out today, the April ISM manufacturing index ready came in lower than expected and the March report on construction spending was substantially weaker than forecast (more coverage here). In Asia, China’s PMI was lower than expected and raised worries that the Asian growth is slowing down (more coverage here). Markets in China and Hong Kong were closed today for the May Day holiday. The FOMC announcement in mid-afternoon offered a slightly different view on how the Fed’s asset buying may proceed (more coverage here).

The U.S. dollar index is trading down 0.28% today, now at 81.521. The GSCI commodity index is down 0.9% at 624.44. WTI crude oil closed down 2.6%, at $91.03 a barrel, following a massive increase in commercial inventories (more coverage here). Brent crude trades down 2.4% at $99.89 a barrel, as the spread between WTI and Brent now falls below $10 a barrel (more coverage here). Natural gas is down 0.4% today at about $4.32 per million BTUs. Gold settled down 1.8% today at $1,446.20 an ounce.

The unofficial closing bells put the DJIA down about 139 points to 14,700.95 (-0.94%), the NASDAQ about 30 points (-0.89%) to 3,299.13, and the S&P 500 fell -0.93% or nearly 15 points to 1,582.70.

There were a several analyst upgrades and downgrades today, including Biogen Idec Inc. (NASDAQ: BIIB) removed from “Conviction Buy” list and cut to ‘neutral’ at Goldman Sachs; Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) raised to ‘buy’ at Nomura; Berkshire Hathaway Inc. (NYSE: BRK-A) raised to ‘buy’ at Nomura; Amgen Inc. (NASDAQ: AMGN) added to “Conviction Buy” list at Goldman Sachs; and Oil States International Inc. (NYSE: OIS) cut to ‘underperform’ at BMO Capital Markets and cut to ‘market perform’ at Raymond James.

Earnings reports since markets closed last night resulted in some price moves today, including these as of the last half hour of trading: Affymetrix Inc. (NASDAQ: AFFX) is down 8% at $3.35; Bankrate Inc. (NYSE: RATE) is up 14.7% at $15.46; Leap Wireless International Inc. (NASDAQ: LEAP) is down 3.2% at $5.54; Spectrum Brands Holdings Inc. (NYSE: SPB) is down 4.6% at $53.44; Trulia Inc. (NYSE: TRLA) is up 13.1% at $32.86; Vanguard Health Systems Inc. (NYSE: VHS) is down 8.3% at $13.41; ADT Corp. (NYSE: ADT) is down 6.9% at $40.65; Chesapeake Energy Corp. (NYSE: CHK) is down 2.1% at $19.14 (more coverage here); Comcast Corp. (NASDAQ: CMCSA) is up 1.2% at $41.81 (more coverage here); Humana Inc. (NYSE: HUM) is up 4.4% at $77.38; James River Coal Co. (NASDAQ: JRCC) is up 32.8% at $2.19; Mastercard Inc. (NYSE: MA) is down 2.3% at $540.47; Phillips 66 (NYSE: PSX) is down 2.1% at $59.68 (more coverage here); and Viacom Corp. (NASDAQ: VIAB) is up 3.2% at $66.01 after posting a new 52-week high of $69.00 earlier today.

Before markets open tomorrow morning we are scheduled to hear earnings reports from Archer Daniels Midland Co. (NYSE: ADM), Avis Budget Group Inc. (NASDAQ: CAR), CBS Corp. (NYSE: CBS), Facebook Inc. (NASDAQ: FB), JDS Uniphase Corp. (NASDAQ: JDSU), Las Vegas Sands Corp. (NYSE: LVS), Seagate Technology PLC (NASDAQ: STX), Tesoro Corp. (NYSE: TSO), Visa Inc. (NYSE: V), Alpha Natural Resources Inc. (NYSE: ANR), Cigna Corp. (NYSE: CI), Goldcorp Inc. (NYSE: GG), and Monster Worldwide Inc. (NYSE: MWW).

Some standouts among heavily traded stocks today include:

Advanced Micro Devices Inc. (NYSE: AMD) is up 13.1% at $3.19. The chipmaker had no big news today, although it did introduce two new microprocessors and made some pricing changes that indicate that the company’s pricing may have stabilized.

Sirius XM Radio Inc. (NASDAQ: SIRI) is up 3.4% at $3.36 after posting a new 52-week (and 5-year) high of $3.39 earlier today. The satellite radio company posted a second consecutive high today, continuing to feast off yesterday’s earnings report.

Merck & Co. (NYSE: MRK) is down 2.8% at $45.67. The drug maker slid on its lackluster earnings results and took a slice out of its sales and earnings targets for the rest of the year.

Stay tuned for Thursday. We have noted the following events on the schedule (all times Eastern):

7:30 a.m. – Challenger job-cut report
8:30 a.m. – International trade
8:30 a.m. – New claims for unemployment benefits
8:30 a.m. – Productivity and costs
10:30 a.m. – EIA weekly natural gas storage report
4:30 p.m. – Fed balance sheet and money supply

Filed under: Investing Tagged: ADM, ADT, AFFX, AMD, AMGN, ANR, BIIB, BRK-A, CAR, CBS, CHK, CI, CMCSA, FB, FCX, GG, HUM, IOS, JDSU, JRCC, LEAP, LVS, MA, MRK, MWW, PSX, RATE, SIRI, SPB, STX, TRLA, TSO, V, VHS, VIA-B

24/7 Wall St. Closing Bell — Tuesday: Markets Mixed at Open, Closes Slightly Higher

Paul Ausick — Tue, 30 Apr 2013 20:06:01 +0000

U.S. equity markets opened mixed this morning as investors weighed conflicting data from the U.S., Europe, and Asia. In Europe, retail sales declined more than expected in Germany, Italy’s unemployment rate remained unchanged at 11.5%, and eurozone inflation moderated to 1.2%, below a forecast for inflation of 1.6%. In Asia, Japanese industrial production rose less than expected, retail unexpectedly fell, and unemployment came in below expectations. In the U.S., the S&P Case-Shiller housing price index rose more than expected (more coverage here), while the Chicago PMI came in well below expectations and chilled investors for a spell this morning (more coverage here). The latest U.S. consumer confidence index came in higher than expected, which put some heat back into the morning trading session (more coverage here).

The U.S. dollar index is trading down 0.47% today, now at 81.762. The GSCI commodity index is up 1.2% at 629.99. WTI crude oil closed down 1.1%, at $93.46 a barrel, down 3.9% for the month of April. Brent crude trades down 1.6% at $102.19 a barrel. Natural gas is down 0.4% today at about $4.15 per million BTUs. Gold settled up 0.3% today at $1,472.10 an ounce, but lost 7.8% for the month, the largest drop in 16 months.

The unofficial closing bells put the DJIA up more than 20 points to 14,839.18 (0.14%), the NASDAQ rose nearly 22 points (0.66%) to 3,328.79, and the S&P 500 rose 0.24% or nearly 4 points to 1,597.45.

There were a several analyst upgrades and downgrades today, including Pandora Media Inc. (NYSE: P) initiated as ‘sector perform’ at RBC Capital Markets; Buffalo Wild Wings Inc. (NASDAQ: BWLD) cut to ‘hold’ at KeyBanc; Best Buy Co. Inc. (NYSE: BBY) raised to ‘buy’ at Deutsche Bank (more coverage here); PulteGroup Inc. (NYSE: PHM) cut to ‘neutral’ at J.P. Morgan; and SINA Corp. (NASDAQ: SINA) raised to ‘buy’ at Jefferies.

Earnings reports since markets closed last night resulted in some price moves today, including these as of the last half hour of trading: Embraer SA (NYSE: ERJ) is up 6.7% at $34.94; Express Scripts Holding Co. (NASDAQ: ESRX) is up 1.6% at $59.38; General Growth Properties Inc. (NYSE: GGP) is up 2.2% at $22.50 after posting a new 52-week high of $22.80 earlier today; Herbalife Ltd. (NYSE: HLF) is up 2.7% at $39.78 (more coverage here); Hertz Global Holdings Inc. (NYSE: HTZ) is up 0.2% at $24.03 after posting a new 52-week high of $24.79 earlier today; Newmont Mining Corp. (NYSE: NEM) is down 5% at $32.27 after posting a new 52-week low of $31.33 earlier today; Riverbed Technology Inc. (NASDAQ: RVBD) is up fractionally at $14.86; 3D Systems Corp. (NYSE: DDD) is up 7.3% at $38.39; Aetna Inc. (NYSE: AET) is up 2.5% at $57.55 after posting a new 52-week high of $58.63 earlier today; Anheuser-Busch InBev SA (NYSE: BUD) is up 0.3% at $95.72; Avon Products Inc. (NYSE: AVP) is up 4.5% at $23.23 after posting a new 52-week high of $24.30 earlier today; BP plc (NYSE: BP) is up 2.3% at $43.61 (more coverage here); Harvest Natural Resources Inc. (NYSE: HNR) is down 5.5% at $3.25; Marathon Petroleum Corp. (NYSE: MPC) is down 4.9% at $78.39; Office Depot Inc. (NYSE: ODP) is up 4.9% at $3.88; United States Steel Corp. (NYSE: X) is up 0.3% at $17.59; and Valero Energy Corp. (NYSE: VLO) is down 2.5% at $40.17 (more coverage here).

Before markets open tomorrow morning we are scheduled to hear earnings reports from Affymetrix Inc. (NASDAQ: AFFX), Bankrate Inc. (NYSE: RATE), Leap Wireless International Inc. (NASDAQ: LEAP), Spectrum Brands Holdings Inc. (NYSE: SPB), Trulia Inc. (NASDAQ: TRLA), Vanguard Health Systems Inc. (NYSE: VHS), ADT Corp. (NYSE: ADT), Chesapeake Energy Corp. (NYSE: CHK), Comcast Corp. (NASDAQ: CMCSA), Humana Inc. (NYSE: HUM), James River Coal Co. (NASDAQ: JRCC), Mastercard Inc. (NYSE: MA), and Viacom Corp. (NASDAQ: VIAB).

Some standouts among heavily traded stocks today include:

Sirius XM Radio Inc. (NASDAQ: SIRI) is up 5.5% at $3.24 after posting a new 52-week high of $3.25 earlier today. The satellite radio company posted good numbers and made permanent the hire of interim CEO James Meyer.

Delcath Systems Inc. (NASDAQ: DCTH) is down 39.8% at $0.84. The pharmaceutical and medical device maker will have to repeat a clinical trial.

Pitney Bowes Inc. (NYSE: PBI) is down 16.6% at $13.52. The business equipment company had a 57% drop in profits and cut its dividend.

Stay tuned for Wednesday. The Federal Open Market Committee (FOMC) concludes a two-day meeting. We have also noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Bankers Association purchase applications
8:15 a.m. – ADP employment report
8:58 a.m. – PMI manufacturing index
10:00 a.m. – ISM manufacturing index
10:00 a.m. – Construction spending
10:30 a.m. – EIA weekly petroleum status report
2:00 p.m. – FOMC meeting announcement

Filed under: Investing Tagged: ADT, AET, AFFX, AVP, BBY, BP, BUD, BWLD, CHK, CMCSA, DCTH, DDD, ESRX, GGP, HLF, HNR, HTZ, HUM, JRCC, LEAP, MA, MPC, NEM, ODP, P, PBI, PHM, RATE, RVBD, SINA, SIRI, SPB, TRLA, VHS, VIA-B, VLO, X

24/7 Wall St. Closing Bell — Monday: Markets Open Higher, S&P Closes on New High

Paul Ausick — Mon, 29 Apr 2013 20:07:42 +0000

U.S. equity markets opened higher this morning after the U.S. Department of Commerce reported that personal income and spending both rose by 0.2%, which was slightly higher than expected for spending and slightly lower than expectations for income (more coverage here). We also noted the sharp drop in spending on energy and the impact that could have on oil and gasoline prices for the rest of this year (more coverage here). In Europe, new data was limited to Italian business confidence (down), Spanish retail sales (also down, but not as much as expected), and eurozone business and consumer survey (more coverage here). Italian government borrowing costs posted a two-year low (more coverage here). In Asia, both Japanese and Chinese markets were closed for a holiday. U.S. pending home sales rose in March, reversing a drop in February sales (more coverage here).

The U.S. dollar index is trading down 0.42% today, now at 82.159. The GSCI commodity index is down 0.5% at 622.29. WTI crude oil closed up 1.6%, at $94.50 a barrel. Brent crude trades up 0.5% at $103.72 a barrel. Natural gas is up 4% today at about $4.39 per million BTUs. Gold settled up 1% today at $1,467.40 an ounce.

The unofficial closing bells put the DJIA up more than 106 points to 14,818.83 (0.72%), the NASDAQ rose nearly 28 points (0.85%) to 3,307.02, and the S&P 500 rose 0.72% or more than 11 points to 1,593.59, a new high.

There were a several analyst upgrades and downgrades today, including Walt Disney Co. (NYSE: DIS) raised to ‘buy’ at UBS; Petroleo Brasileiro SA (NYSE: PBR), aka Petrobras, raised to ‘buy’ at BofA/Merrill Lynch; Union Pacific Co. (NYSE: UNP) cut to ‘hold’ at TD Securities; Gold Fields Inc. (NYSE: GFI) cut to ‘neutral’ at HSBC; and Abercrombie & Fitch Co. (NYSE: ANF) raised to ‘outperform’ at Macquarie.

Earnings reports since markets closed last Friday resulted in some price moves today, including these as of the last half hour of trading: Eaton Corp. (NYSE: ETN) is up 3.6% at $60.76; Loews Corp. (NYSE: L) is up 0.4% at $44.63 (more coverage here); Senior Housing Properties Trust (NYSE: SNH) is down 1.4% at $28.18; and Sohu.com Inc. (NASDAQ: SOHU) is down 0.2% at $50.66.

Before markets open tomorrow morning we are scheduled to hear earnings reports from Embraer SA (NYSE: ERJ), Express Scripts Holding Co. (NASDAQ: ESRX), General Growth Properties Inc. (NYSE: GGP), Herbalife Ltd. (NYSE: HLF), Hertz Global Holdings Inc. (NYSE: HTZ), Newmont Mining Corp. (NYSE: NEM), Riverbed Technology Inc. (NASDAQ: RVBD), 3D Systems Corp. (NYSE: DDD), Aetna Inc. (NYSE: AET), Anheuser-Busch InBev SA (NYSE: BUD), Avon Products Inc. (NYSE: AVP), BP plc (NYSE: BP), Harvest Natural Resources Inc. (NYSE: HNR), Marathon Petroleum Corp. (NYSE: MPC), Office Depot Inc. (NYSE: ODP), Sirius XM Radio Inc. (NASDAQ: SIRI), United States Steel Corp. (NYSE: X), and Valero Energy Corp. (NYSE: VLO).

Some standouts among heavily traded stocks today include:

Petroleo Brasileiro SA (NYSE: PBR) is up 6.6% at $19.23. Petrobras, as it’s known, reported lousy earnings, but it forecast growth going forward, added to a possible restart of drilling by Chevron Corp. (NYSE: CVX) in the Frade field following a year of inactivity due to a spill.

Conceptus Inc. (NASDAQ: CPTS) is up 19.5% at $30.95. The medical device maker is being acquired by Germany’s Bayer AG $1.1 billion.

Zynga Inc. (NASDAQ: ZNGA) is down 3.6% at $3.23. The social games maker had no news today, but is giving back some of Friday’s gains, which followed losses earlier last week on a weak earnings report.

Stay tuned for Tuesday. The Federal Open Market Committee (FOMC) begins a two-day meeting. We have also noted the following events on the schedule (all times Eastern):

8:30 a.m. – Employment cost index
9:00 a.m. – S&P Case-Shiller house price index
9:45 a.m. – Chicago purchasing manager’s index
10:00 a.m. – Conference Board consumer confidence index
11:30 a.m. – 4- and 52-week bill auctions
3:00 p.m. – Farm prices

Filed under: Investing Tagged: AET, ANF, AVP, BP, BUD, CPTS, CVX, DDD, DIS, ERJ, ESRX, ETN, GFI, GGP, HLF, HNR, HTZ, L, MPC, NEM, ODP, PBR, RVBD, SIRI, SNH, SOHU, UNP, VLO, X, ZNGA

Big Short Seller Attack on Cult Stocks and Low-Priced Stocks (ALU, GNW, GRPN, MU, MTG, NOK, RSH, SIRI, ZNGA)

Jon C. Ogg — Wed, 27 Mar 2013 11:10:46 +0000

The short interest in the actively traded low-priced stocks and cult stocks saw some significant changes since the end of February, with more bets against these companies on the rise. We compared the March 15 settlement date to the February 28 settlement date and added additional color on each of these. By our count, the gains in short selling rose by a margin of 7-to-2.

Here we look at the following active cult low-priced stocks with their short interest reports: Alcatel-Lucent S.A. (NYSE: ALU), Genworth Financial Inc. (NYSE: GNW), Groupon Inc. (NASDAQ: GRPN), Micron Technology Inc. (NASDAQ: MU), MGIC Investment Corp. (NYSE: MTG), Nokia Corp. (NYSE: NOK), RadioShack Corp. (NYSE: RSH), Sirius XM Radio Inc. (NASDAQ: SIRI) and Zynga Inc. (NASDAQ: ZNGA).

Alcatel Lucent S.A. (NYSE: ALU) saw its short interest rise to 16.29 million shares in mid-March from 14.355 million shares at the end of February. This is the highest level of 2013.

Genworth Financial Inc. (NYSE: GNW) has been challenging and surpassing that $10 price again, and short sellers upped their attack to 16.88 million shares short in mid-March, versus 14.69 million two weeks earlier. That is the highest short interest going back more than a year.

Groupon Inc. (NASDAQ: GRPN) saw a real huge gain in the short selling to 40.49 million shares from 27.51 million shares short just two weeks earlier. It has been higher before, but that is the highest short interest of 2013.

Micron Technology Inc. (NASDAQ: MU) shares are trying to break out above $10 again, but the short sellers are really boosting their attacks. The short interest rose 14% to 83.5 million shares in mid-March. That is yet again another highest short interest reading going back a full year.

MGIC Investment Corp. (NYSE: MTG) saw its short interest rise a whopping 22% to 38.84 million shares in mid-March, against 29.35 million shares short in late-February. On a nominal basis, that is the highest short interest since last July.

Nokia Corp. (NYSE: NOK) saw a 3.5% drop in the short interest but remains elevated. That was 326.6 million shares short in mid-March, versus 337.9 million shares short in late February.

RadioShack Corp. (NYSE: RSH) saw its short interest pick up again, perhaps on downgrades and less hope from analysts. The short interest rose almost 5% to 35.336 million shares in mid-March, versus 33.76 million shares at the end of February. That is the highest short interest in this name for 2013.

Sirius XM Radio Inc. (NASDAQ: SIRI) saw its short interest fall to 399.789 million shares as of March 15, down about 3.5% from the 414 million shares short at the end of February. There is little comment to add here.

Zynga Inc. (NASDAQ: ZNGA) saw its third straight gain in the short selling activity, up almost 8% to 28.21 million shares in mid-March, versus 26.13 million shares short in late February. This was yet again the largest short interest since last July.

Filed under: Investing Tagged: ALU, GNW, GRPN, MTG, MU, NOK, RSH, SIRI, ZNGA

Major Short Interest Changes in Low-Priced Cult Stocks (ALU, GNW, GRPN, MU, MTG, NOK, RSH, SIRI, ZNGA)

Jon C. Ogg — Tue, 12 Mar 2013 13:15:04 +0000

The short interest in the actively traded low-priced stocks saw some significant changes at the end of February. We compared the February 28 settlement date to the February 15 settlement date and added in additional color if applicable.

Here we look at the following active cult low-priced stocks with their short interest reports: Alcatel-Lucent S.A. (NYSE: ALU), Genworth Financial Inc. (NYSE: GNW), Groupon Inc. (NASDAQ: GRPN), Micron Technology, Inc. (NASDAQ: MU), MGIC Investment Corp. (NYSE: MTG), Nokia Corp. (NYSE: NOK), RadioShack Corp. (NYSE: RSH), Sirius XM Radio Inc. (NASDAQ: SIRI) and Zynga Inc. (NASDAQ: ZNGA).

Alcatel-Lucent S.A. (NYSE: ALU) saw its short interest move up to 14.355 million shares from 13.562 million shares. The change remains static on a days-to-cover ratio of 1.0.

Genworth Financial Inc. (NYSE: GNW) was a low-priced stock only until the Barron’s tout this weekend. Its short interest rose by 6.5% to 14.694 million shares short at the end of February. That is still the highest short interest since the end of last November.

Groupon Inc. (NASDAQ: GRPN) saw a real drop in its short interest as investors must have anticipated a management change or some sort of change. That fell to 27.514 million from 31.921 million shares.

Micron Technology Inc. (NASDAQ: MU) saw its short interest lift to the highest reading in a year, with a gain of close to 10% in shares short to 73.234 million shares from 66.131 million shares.

MGIC Investment Corp. (NYSE: MTG) saw its short interest remain mostly flay, but this was before the big move and capitalization. The Feb. 28 short interest was 29.356 million shares, versus 29.136 million shares short in the previous period. That days to cover was only about half of the prior reading though, and that was down to 2.979 days.

Nokia Corp. (NYSE: NOK) saw its short interest tick up by about 2% 337.98 million shares, versus 330.97 million shares.

RadioShack Corp. (NYSE: RSH) had very little change in its short interest, but it did tick higher to 33.76 million shares short versus 32.56 million shares short.

Sirius XM Radio Inc. (NASDAQ: SIRI) saw a higher reading in short selling but not a major increase. Short interest rose to 414.016 million shares short from 406.288 million.

Zynga Inc. (NASDAQ: ZNGA) saw only a small gain in its short interest to 26.137 million shares short at the end of February, from 25.944 million shares short in mid-February. While only a small gain, this was the largest short interest since last July.

Filed under: Investing Tagged: ALU, GNW, GRPN, MTG, MU, NOK, RSH, SIRI, ZNGA

Pandora Signs More Advertising Measurement Services

Jon C. Ogg — Tue, 05 Mar 2013 14:15:11 +0000

Pandora Media Inc. (NYSE: P) has recovered handily off of its lows as the Internet radio player has been trying to mature as a public company. While its costs have risen in unison with user usage, now the company has more venues for the $14 billion annual radio advertising market. Pandora’s audience data will appear in the three most popular media buying platforms, including STRATA, and Mediaocean’s Donovan and Mediabank stewardship systems.

On the surface it sounds like one more tool to compete against Sirius XM Radio Inc. (NASDAQ: SIRI). The real target it seems is local radio station advertising.

The company showed that radio advertisement space buyers will be able to compare Pandora’s audience data side-by-side with broadcast radio stations across the country. Prior to the integrations, radio buyers using STRATA and Mediaocean systems were required to manually research Pandora audience ratings, and now they can instantly evaluate Pandora audience size and rankings for advertising decision making.

STRATA’s integration was released in January, and all STRATA agencies now have access to Pandora audience data. Pandora said that Mediaocean is currently in beta release, with rollout to Mediabank systems in mid-March 2013, while Donovan systems will be rolling out by the end of this April.

Pandora shares closed at $12.00 on Monday against a 52-week trading range of $7.08 to $14.65. Its market cap is currently right at $2 billion.

Filed under: Media Tagged: P, SIRI

Hidden Gems in the Sirius XM Annual Report

Jon C. Ogg — Thu, 07 Feb 2013 12:55:56 +0000

We have mostly come through earnings season, and the start of February turns into “Annual Report Season” on Wall St. This is when investors get to see how all the ongoing and new lawsuits and other crucial issues can impact their companies they have invested in. If there is one cult stock in media, it is Sirius XM Radio Inc. (NASDAQ: SIRI). The satellite radio monopoly released its annual report in a 10-K filing with the Securities and Exchange Commission, and we have found some interesting issues that shareholders will want to consider.

Here are the hidden gems from the Sirius XM 10-K.

Competitive threats. The satellite radio may be a monopoly in the classic sense, but it warns of increased competition through time. Sirius said:

We face substantial competition from other providers of radio and other audio services. Our ability to retain and attract subscribers depends on our success in creating and providing popular or unique music, entertainment, news and sports programming. Our subscribers can obtain certain similar content for free through terrestrial radio stations or Internet radio services. Audio content delivered via the Internet, including through mobile devices, is increasingly competitive with our services. In addition, automakers and aftermarket manufacturers have introduced factory-installed radios capable of seamlessly accessing Internet-delivered audio entertainment and easily connecting to Internet-delivered content on smartphones.

In short, Sirius XM is at least recognizing that Pandora Media Inc. (NYSE: P), Spotify and others are still threats to the business.

Satellite risks continue to be substantial. Sirius is planning another satellite launch this year. These are expensive and risky, and it said, “Space Systems/Loral has constructed a new satellite for the Sirius system that is expected to be launched during mid-2013.” Sirius also said that, if it has a satellite failure or if its satellites experience degradation on their solar arrays, it has a backup: “Our XM-5 satellite serves as an in-orbit spare for both of our services. In the event of a failure of XM-3, XM-4 or any of the Sirius satellites, service would be maintained through XM-5.” That being said, it has some insurance to offset some of the risks and said that it maintains “in-orbit insurance policies” covering only its XM-5 and FM-5 satellites. But it also warned that these policies will expire in 2014 and 2015 and Sirius may not renew them.

Higher royalty rates for the same music content. The company said that the royalty rate for 2012 was 8.0%, but that has just risen.

New royalty rates for our use of sound recordings during the five-year period beginning in January 2013 were announced by the CRB in December 2012. Under the terms of the CRB’s decision, we will pay a royalty based on gross revenues, subject to certain exclusions, of 9.0% for 2013, 9.5% for 2014, 10.0% for 2015, 10.5% for 2016, and 11% for 2017.

While this was previously disclosed, it means that if all other costs are kept flat its operating expenses rise. After looking at the breakdown of expenses, this only gets more important. The company’s 2012 cost of services shows that revenue share and royalties paid out were the largest single expense at $551 million out of a total $2.53 billion in operating expenses for the year.

Less debt at lower rates. The company’s formal long-term debt at the end at the end of 2011 was more than $3 billion. The 10-K stated:

As of December 31, 2012, we had an aggregate principal amount of approximately $2.5 billion of indebtedness. We also have entered into a senior secured revolving credit facility with a syndicate of financial institutions for $1.25 billion, which had not been drawn upon as of December 31, 2012.

Liberty Media Corp. (NASDAQ: LMCA) and John Malone are in control here. In short, you as a public shareholder have no real rights to influence change now at Sirius XM. It shows in detail:

Liberty Media Corporation beneficially owned approximately 50.21% of the common stock and five current Liberty Media executives are members of its board of directors, and Liberty Media has designated an additional three members of the board of directors. Specific concerns: “Liberty Media has the ability to control our affairs, policies and operations, such as the appointment of management, future issuances of our common stock or other securities, the payment of dividends, if any, on our common stock, the incurrence of debt by us, amendments to our certificate of incorporation and bylaws and the entering into of extraordinary transactions, and their interests may not in all cases be aligned with the interests of other stockholders. In addition, Liberty Media will be able to determine the outcome of all matters requiring stockholder approval and will be able to cause or prevent a change of control of our company or a change in the composition of our board of directors and could preclude any unsolicited acquisition of our company. The concentration of ownership could deprive our stockholder’s of an opportunity to receive a premium for their common stock as part of a sale of our company and might ultimately affect the market price of our common stock.” Sirius even admitted that it is a “controlled company” within the meaning of the NASDAQ listing rules and that offers exemptions from certain corporate governance requirements and the company has elected not to comply with certain NASDAQ corporate governance requirements that a majority of the board of directors consist of independent directors.

The Howard Stern risk continues. The 10-K “LEGAL PROCEEDINGS” states:

One Twelve, Inc. and Don Buchwald v. Sirius XM Radio Inc. In March 2011, One Twelve, Inc., Howard Stern’s production company, and Don Buchwald, Stern’s agent, commenced an action against us in the Supreme Court of the State of New York, County of New York. The action alleged that, upon the Merger, we failed to honor our obligations under the performance-based compensation provisions of our prior agreement dated October 2004 with One Twelve and Buchwald, as agent; One Twelve and Buchwald each assert a claim of breach of contract. In April 2012, the Court granted our motion for summary judgment and dismissed with prejudice the suit. The Court found the agreement unambiguous. One Twelve and Buchwald have appealed this decision.

The term “Mel Karmazin” only appears once in the entire 10-K.

Dividends and share buybacks.

On December 28, 2012, we paid a special cash dividend of $0.05 per share of common stock… Our Series B-1 Preferred Stock held by Liberty participated in this cash dividend… The total amount of this dividend was approximately $327 million. The dividend reflects the board’s desire to return value to stockholders and its confidence in the long-term growth prospects of our business. We currently do not intend to declare recurring dividends on our common stock. Our board of directors has not made any determination whether similar special cash dividends will be paid in the future. Our ability to pay dividends on our common stock is currently limited by covenants under our debt agreements. We retain sufficient capital capacity to continue making long-term investments in our programming, research and development initiatives and overall operations as well as pursue strategic opportunities which may arise… In December 2012, we announced that our board of directors had approved a $2 billion common stock repurchase program, which we will begin utilizing in 2013. Shares of common stock may be purchased from time to time on the open market or in privately negotiated transactions.

The exact year-end figure count on subscribers as of December 31, 2012: 23,900,336 subscribers, of which 19,570,274 were self-pay subscribers and 4,330,062 were paid promotional subscribers. Sirius also has an equity interest in Sirius XM Canada, and those subscribers to the Sirius XM Canada service are not included in the total subscriber count.

On the debt issue. Sirius now has pushed out its debt maturity schedule, which we have reported on before. There are no maturities in 2013, and here are the following maturity schedules: $550 million due in 2014, $800 million in 2015, $700 million due in 2018 and $400 million due in 2022.

FULL 10-K FILING

************

Sirius XM shares have so far withstood the “takeover” better than some may have feared. At $3.16 as of now, that is a gain of 9% so far in 2013. The 52-week trading range is $1.78 to $3.25 and the consensus analyst price target is $3.36 per share from Thomson Reuters.

Filed under: Media Tagged: LMCA, P, SIRI

24/7 Wall St. Closing Bell — February 5, 2013: Markets Recover from Yesterday’s Slump (CLWR, M, SWC, DRI, UNH, CYOU, GCI, HUM, GOLD, RCL, SPG, CLX, APC, BIDU, EW, YUM, AGCO, AGN, ACI, ADM, ARMH, BP, ETN, EL, SIRI, K, CMG, EXPE, GNW, TTWO, DIS, ZNGA, CVS, MRO, NUS, RL, SYT, TWX, DELL, OPXA, MHP)

Paul Ausick — Tue, 05 Feb 2013 21:04:01 +0000

U.S. equity markets opened higher this morning and maintained their upward momentum for essentially the whole day. Lacking any really bad news from Asia or Europe, U.S. markets shrugged off a weaker than expected ISM non-manufacturing PMI number (more coverage here) and focussed instead on a generally upbeat day in European markets. In Asia, China’s PMI came in better than expected and Australia’s central bank left its key interest rate unchanged. In Europe, eurozone non-manufacturing PMI came in slightly better than expected. After yesterday’s worst session of the year so far, today’s trading seems positively sprightly.

The U.S. dollar index fell 0.02% today, now at 79.536. The GSCI commodity index is down 0.8% at 673.87, with commodities prices mixed again today. WTI crude oil closed up 0.5% today, at $96.64 a barrel. Brent crude trades up 0.8% at $116.54 a barrel. Natural gas is up 2.7% today at about $3.40 per million BTUs. Gold settled down 0.2% today at $1,673.50 an ounce.

The unofficial closing bells put the DJIA up more than 98 points to 13,978.53 (0.71%), the NASDAQ rose more than 40 points (1.29%) to 3,171.59, and the S&P 500 rose 1.04% or nearly 16 points to 1,511.26.

There were a several analyst upgrades and downgrades today, including Clearwire Corp. (NASDAQ: CLWR) cut to ‘underperform’ at D.A. Davidson; Macy’s Inc. (NYSE: M) raised to ‘buy’ at Citigroup; Stillwater Mining Co. (NYSE: SWC) raised to ‘overweight’ at J.P. Morgan (more platinum coverage here); D.R. Horton Inc. (NYSE: DRI) raised to ‘overweight’ at Barclays; and UnitedHealth Group Inc. (NYSE: UNH) raised to Conviction Buy List at Goldman Sachs.

Earnings reports since markets closed last night resulted in several price moves today, including these: Anadarko Petroleum Co. (NYSE: APC) is up 3.3% at $83.15; Baidu Inc. (NASDAQ: BIDU) is down 10.4% at $96.06; Edwards Lifesciences Corp. (NYSE: EW) is down 6.7% at $86.79; Yum! Brands Inc. (NYSE: YUM) is down 2.8% at $62.15 (more coverage here); AGCO Corp. (NYSE: AGCO) is up 2.1% at $53.62; Allergan Inc. (NYSE: AGN) is up 1.6% at $106.75; Archer Daniels Midland Co. (NYSE: ADM) is up 3.4% at $29.42 (more coverage here); ARM Holdings plc (NASDAQ: ARMH) is up 4.3% at $43.76 after posting a new 52-week high of $44.00 earlier today (more coverage here); BP plc (NYSE: BP) is up 1.5% at $44.26 (more coverage here); Eaton Corp. (NYSE: ETN) is up 5.1% at $59.45 after posting a new 52-week high of $60.45 earlier today; Estee Lauder Companies Inc. (NYSE: EL) is up 6.1% at $64.79; Sirius XM Radio Inc. (NASDAQ: SIRI) is down 0.5% at $3.15; and Kellogg Inc. (NYSE: K) is up 0.8% at $58.55 after posting a new 52-week high of $59.30 earlier today.

After markets close today and before they open tomorrow morning we are scheduled to hear from Chipotle Mexican Grill Inc. (NYSE: CMG), Expedia Inc. (NASDAQ: EXPE), Genworth Financial Inc. (NYSE: GNW), Take-Two Interactive Software Inc. (NASDAQ: TTWO), Walt Disney Co. (NYSE: DIS), Zynga Inc. (NASDAQ: ZNGA), CVS Caremark Corp. (NYSE: CVS), Marathon Oil Corp. (NYSE: MRO), Nu Skin Enterprises Inc. (NYSE: NUS), Ralph Lauren Corp. (NYSE: RL), Syngenta AG (NYSE: SYT), and Time Warner Inc. (NYSE: TWX).

Some standouts from today include the following stocks:

Dell Inc. (NASDAQ: DELL) is up 1.3% at $13.45. The PC maker has agreed to be taken private in a deal worth more than $24 billion. More coverage here.

Arch Coal Inc. (NYSE: ACI) is down 12.4% at $6.07. The coal miner badly missed estimates this morning and the outlook for the first half of this year is not encouraging. More coverage here.

Opexa Therapeutics Inc. (NASDAQ: OPXA) is up 162.8% at $3.18. The biopharma company has struck a deal with Germany’s Merck related to Opexa’s treatment for multiple sclerosis. More coverage here.

The McGraw-Hill Companies (NYSE: MHP) is down 11.5% at $44.52. The financial information firm continued to get battered today as the U.S. Department of Justice announced charges against its S&P ratings agency for failure properly to let investors know the value of subprime mortgage bonds back in 2008.

Stay tuned for Wednesday. We have also noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Bankers Association purchase applications
10:30 a.m. – EIA weekly petroleum status report
3:00 p.m. – Treasury STRIPS

Filed under: Investing Tagged: ACI, ADM, AGCO, AGN, APC, ARMH, BIDU, BP, CLWR, CLX, CMG, CVS, CYOU, DELL, DIS, DRI, EL, ETN, EW, EXPE, GCI, GNW, gold, HUM, K, M, MHP, MRO, NUS, OPXA, RCL, RL, SIRI, SPG, SWC, SYT, TTWO, TWX, UNH, YUM, ZNGA

24/7 Wall St. Closing Bell — February 4, 2013: Markets Slump on Europe Mess (YHOO, MRK, GOOG, CVX, BRCM, CYOU, GCI, HUM, GOLD, RCL, SPG, CLX, APC, BIDU, EW, YUM, AGCO, AGN, ACI, ADM, ARMH, BP, ETN, EL, K, SIRI, BBRY, APKT, ORCL, MHP)

Paul Ausick — Mon, 04 Feb 2013 21:06:57 +0000

U.S. equity markets opened lower this morning as concerns about European markets reared up again. The U.K.’s PMI came in lower than expected and consumer confidence was lower, sending equities markets on the continent lower. Several Italian banks are being investigated for derivatives deals and a scandal in Spain also heated up over the weekend. In Asia, China reported a slightly higher-than-expected non-manufacturing PMI number (more coverage here). In the U.S., factory orders were up, but by less than expected (more coverage here). Earnings reports were scarce, so there wasn’t much for investors to take positive direction from.

The U.S. dollar index rose 0.5% today, now at 79.552. The GSCI commodity index is up 0.6% at 679.05, with commodities prices mixed today. WTI crude oil closed down 1.6% today, at $96.17 a barrel. Brent crude trades down 1% at $115.58 a barrel. Natural gas is up 0.5% today at about $3.32 per million BTUs. Gold settled up 0.4% today at $1,676.40 an ounce (more gold coverage here).

The unofficial closing bells put the DJIA down nearly 130 points to 13,880.08 (-0.93%), the NASDAQ fell about 48 points (-1.51%) to 3,131.17, and the S&P 500 fell -1.15% or more than 17 points to 1,495.72.

There were a several analyst upgrades and downgrades today, including Yahoo! Inc. (NASDAQ: YHOO) raised to ‘buy’ at Stifel Nicolaus; Merck & Co. (NYSE: MRK) cut to ‘underweight’ at Morgan Stanley; Google Inc. (NASDAQ: GOOG) cut to ‘market perform’ at BMO; Chevron Corp. (NYSE: CVX) cut to ‘neutral’ at UBS; and Broadcom Corp. (NASDAQ: BRCM) reiterated as ‘buy’ with a $46 price target at Argus.

Earnings reports since markets closed last night resulted in several price moves today, including these: Changyou.com Ltd. (NASDAQ: CYOU) is down 9.5% at $28.34; Gannett Co. Inc. (NYSE: GCI) is 6.1% at $18.64; Humana Inc. (NYSE: HUM) is up 4.5% at $78.76 (more coverage here); Randgold Resources Ltd. (NASDAQ: GOLD) is up 2.7% at $98.24 (more coverage here); Royal Caribbean Cruises Ltd. (NYSE: RCL) is down 3.8% at $35.41 (more coverage here); Simon Property Group Inc. (NYSE: SPG) is up 0.1% at $162.18; and The Clorox Co. (NYSE: CLX) is up 0.8% at $79.81 after posting a new 52-week high of $80.68.

After markets close today and before they open tomorrow morning we are scheduled to hear from Anadarko Petroleum Co. (NYSE: APC), Baidu Inc. (NASDAQ: BIDU), Edwards Lifesciences Corp. (NYSE: EW), Yum! Brands Inc. (NYSE: YUM), AGCO Corp. (NASDAQ: AGCO), Allergan Inc. (NYSE: AGN), Arch Coal Inc. (NYSE: ACI), Archer Daniels Midland Co. (NYSE: ADM), ARM Holdings plc (NASDAQ: ARMH), BP plc (NYSE: BP), Eaton Corp. (NYSE: ETN), Estee Lauder Companies Inc. (NYSE: EL), Sirius XM Radio Inc. (NASDAQ: SIRI), and Kellogg Inc. (NYSE: K).

Some standouts from today include the following stocks:

BlackBerry (NASDAQ: BBRY) is up 13.9% at $14.84. The smartphone maker, formerly known as Research in Motion, got a boost today from a report of good opening weekend sales in the U.K.. More coverage here.

Acme Packet Inc. (NASDAQ: APKT) is up 23.4% at $29.53. The networking firm is being acquired by Oracle Corp. for $1.7 billion. More coverage here.

The McGraw-Hill Companies (NYSE: MHP) is down 13.4% at $50.50. The financial information firm is getting hammered following a report that its S&P ratings agency may be investigated for its failure properly to let investors know the value of subprime mortgage bonds back in 2008. More coverage here. The company denies the any wrongdoing. More coverage here.

Stay tuned for Tuesday. Fed Governor Elizabeth Duke is giving a speech. We have also noted the following events on the schedule (all times Eastern):

10:00 a.m. – Institute for Supply Management non-manufacturing index
11:30 a.m. – 4- and 52-week Treasury bill auctions

Filed under: Investing Tagged: ACI, ADM, AGCO, AGN, APC, APKT, ARMH, BBRY, BIDU, BP, BRCM, CLX, CVX, CYOU, EL, ETN, EW, GCI, gold, GOOG, HUM, K, MHP, MRK, ORCL, RCL, SIRI, SPG, YHOO, YUM