All sorts of bad things happen when a stock trades under $1. Some institutions can’t hold the shares. If the stock stays below the threshold too long, the Nasdaq can start delisting procedures.
Sirius (SIRI) hit $.99 this morning. Yesterday it put out guidance that Wall St. abhorred.
Sirius has run out of time and investor goodwill. The company’s subscriber growth will be so modest next year that the issue of the firm’s huge debt load gets larger and larger in the rear view mirror. Sirius can cut costs now that it has taken over XM Satellite. With its share price plunging, no one seems willing to buy the reasoning that 1+1=2.
Satellite radio’s dreams died some time ago. The reasons are so old they have become rancid. Leave it at the Apple (AAPL) iPod’s ascendancy — that is enough. The rest of the daggers are just extra instruments to draw blood.
Douglas A. McIntyre
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