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The Zacks Consensus Estimate for third-quarter earnings has moved south by 2.4% to 80 cents per share in the past 30 days.
Image Source: Zacks Investment Research
The consensus mark for revenues is pegged at $2.19 billion, indicating a 3.52% decrease from the year-ago quarter’s reported figure.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
On Sept. 10, SiriusXM started operating as an independent public company with a simplified capital structure as well as strategy.
Earnings Surprise History
In the last reported quarter, the company matched the Zacks Consensus Estimate for earnings. The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while matching the same once, delivering an average surprise of 14.44%.
Let’s see how things have shaped up for this announcement.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for SiriusXM this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Sirius XM’s third-quarter subscriber revenues are expected to have suffered despite an expanding content catalog of live sporting events and a solid portfolio of streaming services, including the 2024 NFL season.
SIRI’s subscriber revenues in the second quarter declined 3.9% from the year-ago quarter to $1.66 billion. This trend is expected to have continued in the to-be-reported quarter. The Zacks Consensus Estimate for the company’s subscriber revenues is pegged at $1.64 billion, indicating a decline of 4.7% year over year.
In the last quarter, Sirius XM announced Pandora Media LLC as the first audio publisher to adopt Unified ID 2.0, offering advertisers an identity solution with precision targeting, frequency management and measurement. This is likely to have aided advertisement revenues in the to-be-reported quarter.
Advertisement revenues in the second quarter decreased 0.4% year over year to $433 million. The Zacks Consensus Estimate for SIRI’s third-quarter advertisement revenues is pegged at $472 million, indicating a rise of 2.6% year over year.
Sirius XM continues to bolster its content offerings by adding content from all spheres, including music, politics, news and sports, to its platform.
In the quarter under review, SiriusXM announced the launch of SiriusXM Podcasts+, a new subscription available directly in Apple Podcasts that will deliver a seamless and premium listening experience for some of the biggest shows on the SiriusXM Podcast Network.
The company's core business remains robust, with a dominant position in the in-vehicle audio entertainment space reinforced by long-standing partnerships with major automakers like Toyota and Ford. As the automotive industry shifts toward electric and autonomous vehicles, SiriusXM has strategically positioned itself as a key player in the future of in-car entertainment and information services.
In the to-be-reported quarter, SiriusXM announced that Toyota confirmed its participation in its new three-year Extended Service Subscription program designed to empower automakers and dealerships in the United States to deliver even more value to new-vehicle buyers. SiriusXM also announced a renewal of multi-year extension and expansion deal with Ford Motor Company to provide Ford and Lincoln owners access to SiriusXM in vehicle.
SIRI faces intense competition in the streaming space from the likes of Apple (AAPL - Free Report) and Spotify (SPOT - Free Report) , which is expected to hurt the top line in the near term. Apple continues to bolster its presence in the music streaming space backed by acquisitions of Shazam and Asaii. Spotify, the dominant name in the market, is also ramping up its efforts to expand its subscriber base on the back of partnerships with other tech giants.
SiriusXM's traditional stronghold — the automotive sector — is facing unprecedented disruption. The rise of electric vehicles (EVs) and autonomous driving technology has opened the door for tech giants and innovative startups to challenge SiriusXM's once-unassailable position in in-car entertainment. Tesla (TSLA - Free Report) , for instance, has been equipping its vehicles with its own entertainment system, bypassing traditional satellite radio altogether.
Price Performance & Valuation
The satellite radio giant has experienced a dramatic 50.6% decline in its stock price year to date, underperforming the broader Zacks Consumer Discretionary sector’s return of 4.9%. This has raised questions about its prospects and whether it presents a prime buying opportunity for astute investors ahead of third-quarter 2024 earnings.
SIRI Underperforms Sector
Image Source: Zacks Investment Research
From a valuation perspective, SiriusXM's current stock price presents an intriguing opportunity for long-term investors. The company's forward 12-month price-to-earnings (P/E) ratio of 8.13 is significantly below the Zacks Broadcast Radio and Television industry average of 27.36. While this discounted valuation could reflect market concerns, it also suggests a potential upside if the company continues to execute its growth strategy successfully.
SIRI’s P/E F12M Ratio Depicts Discounted Valuation
Image Source: Zacks Investment Research
Investment Thesis
SiriusXM's recent stock decline due to market volatility, interest rate concerns and digital media disruption suggests a wait-and-see approach for investors. The strategic acquisition of Pandora has catapulted SiriusXM to the forefront of audio entertainment, boasting an unparalleled North American listener base exceeding 100 million. This merger combines SiriusXM's robust subscription model with Pandora's lucrative ad-based platform, creating a diversified revenue stream. The synergistic alliance enables cross-platform content distribution, potentially amplifying user engagement, advertiser appeal and content creator attraction. With its enhanced scale, diverse content portfolio, and dual-model approach, SiriusXM is uniquely positioned to capitalize on the evolving digital audio landscape, offering substantial growth potential for long-term investors.
Conclusion
While SiriusXM's stock performance so far in 2024 has been disappointing, the company's strong market position, innovative strategies and dual-model approach make it an intriguing watch for investors ahead of third-quarter 2024 earnings. The company's ability to navigate the changing media landscape and capitalize on emerging technologies is noteworthy. Maintaining a position in SiriusXM appears prudent at present. Investors looking to buy the stock should, however, wait for a better entry point, as intense competition might be perceived as a risk.
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SiriusXM Before Q3 Earnings: Buy the Stock Now or Wait for Results?
Sirius XM (SIRI - Free Report) is set to report third-quarter 2024 earnings on Oct. 31.
The Zacks Consensus Estimate for third-quarter earnings has moved south by 2.4% to 80 cents per share in the past 30 days.
Image Source: Zacks Investment Research
The consensus mark for revenues is pegged at $2.19 billion, indicating a 3.52% decrease from the year-ago quarter’s reported figure.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
On Sept. 10, SiriusXM started operating as an independent public company with a simplified capital structure as well as strategy.
Earnings Surprise History
In the last reported quarter, the company matched the Zacks Consensus Estimate for earnings. The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while matching the same once, delivering an average surprise of 14.44%.
Sirius XM Holdings Inc. Price and EPS Surprise
Sirius XM Holdings Inc. price-eps-surprise | Sirius XM Holdings Inc. Quote
Let’s see how things have shaped up for this announcement.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for SiriusXM this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
SIRI has an Earnings ESP of -4.21% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Factors to Influence SiriusXM’s Q3 Results
Sirius XM’s third-quarter subscriber revenues are expected to have suffered despite an expanding content catalog of live sporting events and a solid portfolio of streaming services, including the 2024 NFL season.
SIRI’s subscriber revenues in the second quarter declined 3.9% from the year-ago quarter to $1.66 billion. This trend is expected to have continued in the to-be-reported quarter. The Zacks Consensus Estimate for the company’s subscriber revenues is pegged at $1.64 billion, indicating a decline of 4.7% year over year.
In the last quarter, Sirius XM announced Pandora Media LLC as the first audio publisher to adopt Unified ID 2.0, offering advertisers an identity solution with precision targeting, frequency management and measurement. This is likely to have aided advertisement revenues in the to-be-reported quarter.
Advertisement revenues in the second quarter decreased 0.4% year over year to $433 million. The Zacks Consensus Estimate for SIRI’s third-quarter advertisement revenues is pegged at $472 million, indicating a rise of 2.6% year over year.
Sirius XM continues to bolster its content offerings by adding content from all spheres, including music, politics, news and sports, to its platform.
In the quarter under review, SiriusXM announced the launch of SiriusXM Podcasts+, a new subscription available directly in Apple Podcasts that will deliver a seamless and premium listening experience for some of the biggest shows on the SiriusXM Podcast Network.
The company's core business remains robust, with a dominant position in the in-vehicle audio entertainment space reinforced by long-standing partnerships with major automakers like Toyota and Ford. As the automotive industry shifts toward electric and autonomous vehicles, SiriusXM has strategically positioned itself as a key player in the future of in-car entertainment and information services.
In the to-be-reported quarter, SiriusXM announced that Toyota confirmed its participation in its new three-year Extended Service Subscription program designed to empower automakers and dealerships in the United States to deliver even more value to new-vehicle buyers. SiriusXM also announced a renewal of multi-year extension and expansion deal with Ford Motor Company to provide Ford and Lincoln owners access to SiriusXM in vehicle.
SIRI faces intense competition in the streaming space from the likes of Apple (AAPL - Free Report) and Spotify (SPOT - Free Report) , which is expected to hurt the top line in the near term. Apple continues to bolster its presence in the music streaming space backed by acquisitions of Shazam and Asaii. Spotify, the dominant name in the market, is also ramping up its efforts to expand its subscriber base on the back of partnerships with other tech giants.
SiriusXM's traditional stronghold — the automotive sector — is facing unprecedented disruption. The rise of electric vehicles (EVs) and autonomous driving technology has opened the door for tech giants and innovative startups to challenge SiriusXM's once-unassailable position in in-car entertainment. Tesla (TSLA - Free Report) , for instance, has been equipping its vehicles with its own entertainment system, bypassing traditional satellite radio altogether.
Price Performance & Valuation
The satellite radio giant has experienced a dramatic 50.6% decline in its stock price year to date, underperforming the broader Zacks Consumer Discretionary sector’s return of 4.9%. This has raised questions about its prospects and whether it presents a prime buying opportunity for astute investors ahead of third-quarter 2024 earnings.
SIRI Underperforms Sector
Image Source: Zacks Investment Research
From a valuation perspective, SiriusXM's current stock price presents an intriguing opportunity for long-term investors. The company's forward 12-month price-to-earnings (P/E) ratio of 8.13 is significantly below the Zacks Broadcast Radio and Television industry average of 27.36. While this discounted valuation could reflect market concerns, it also suggests a potential upside if the company continues to execute its growth strategy successfully.
SIRI’s P/E F12M Ratio Depicts Discounted Valuation
Image Source: Zacks Investment Research
Investment Thesis
SiriusXM's recent stock decline due to market volatility, interest rate concerns and digital media disruption suggests a wait-and-see approach for investors. The strategic acquisition of Pandora has catapulted SiriusXM to the forefront of audio entertainment, boasting an unparalleled North American listener base exceeding 100 million. This merger combines SiriusXM's robust subscription model with Pandora's lucrative ad-based platform, creating a diversified revenue stream. The synergistic alliance enables cross-platform content distribution, potentially amplifying user engagement, advertiser appeal and content creator attraction. With its enhanced scale, diverse content portfolio, and dual-model approach, SiriusXM is uniquely positioned to capitalize on the evolving digital audio landscape, offering substantial growth potential for long-term investors.
Conclusion
While SiriusXM's stock performance so far in 2024 has been disappointing, the company's strong market position, innovative strategies and dual-model approach make it an intriguing watch for investors ahead of third-quarter 2024 earnings. The company's ability to navigate the changing media landscape and capitalize on emerging technologies is noteworthy. Maintaining a position in SiriusXM appears prudent at present. Investors looking to buy the stock should, however, wait for a better entry point, as intense competition might be perceived as a risk.