Sirius
XM Radio Inc (NASDAQ:SIRI) once again had a roller coaster
day as the stock ended higher for the third straight session and made 4-year
high of $2.51 during today’s session. The stock has gained 15.50% in the past
one week including today’s gain of 7.40% to close at $2.47.
Volume has been amazing with more than 324.75
million shares traded hands, while yesterday’s volume stood at over 191.52
million shares. So what’s driving the stock higher? Obviously, the company continued
to report impressive additions in its subscribers during the second
quarter. The company added 622,000 subscribers during the quarter bringing
its total subscribers count to a record level of 22.9 million. In the first
quarter, the company had added 404,596 subscribers, which came ahead of
analysts target and therefore the company lifted its expectations and now
seeing total additions of 1.3 million new subscribers in 2012.
Should
You Buy SIRI Despite Recent rally? Know More By Reading Trend
Analysis
The company had been struggling to earn money since
2010 until 2010 – Almost a decade. However the company returned to
profitability in 2011 and came back strongly with a net income growth of 1000%
year over year.
So what’s driving the company’s subscriber’s growth?
Well, it’s due to solid growth in the auto industry. Demand for Autos is
expected to be higher after lackluster market since recession. This would surely
drive the company’s business well.
However, investors are bit worried about the Liberty
Media’s 46.2% stake in the Sirius XM. John Malone, chairman of Liberty Media bought
bulk shares in May at much lower than the current price. Liberty Media is targeting
to take control over Sirius’ business by acquiring majority stake. So there is
uncertainty about the deal and markets don’t like uncertainty. So the stock may
be trading at bit discount involving uncertainty risk. But, whatever could be
situation, Shares of SIRI may jump even higher after Liberty Media reaches the
deal to get majority control.
We
have Shocking Report On SIRI, Find Here
Sprint
Nextel Corporation (NYSE:S) moved up again on Wednesday and
made 52-week high of $4.60, extending its monthly gain to 40%. On Monday, the
company spooked investors by announcing a reduction in price of iPhone 4S by
$50 to reduce its inventory and generate increased sales ahead of expected
launch of iPhone 5, which is expected
to be launch on Sept 12. The decision was somehow expected as demand for iPhone
has been showing weakness as tech lovers are awaiting for 6th generation
iPhone.
Should
Investors Buy Sprint
Ahead of iPhone 5 Launch
Now, it would be interesting to see how Sprint’s
competitors Verizon Communications Inc.(NYSE:VZ) or AT&T Inc.(NYSE:T) react
to this price cut, which in recent quarters, have sold two to three times as
many iPhones as Sprint.
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