Howard was on 60 Minutes and Mel is raising prices for the 2nd time this year – no analyst expected that! I hit SIRI on the nose on 11/14 and 11/29 with buy calls at the bottoms and we were rewarded for toughing out the drop on 12/1. That trade is up about 10% so far but I’m holding out until 20% at least for the March $6 calls which are still a good buy at $1.85.
Much as I hate to plug them, the link to the video can be found at: http://www.foxnews.com/
Today is really the day to buy as Stern slipped yesterday on O’Reilly 2 major facts.
- He is not getting paid $100M per year (this was a ridiculous rumor)
- Sirius will end the year with 3.1M subscribers – ahead of estimates!
With revenue growth at 400% y/y, a 10% rate increase should yield another 200% next year, even if subscriptions disappoint (if they don’t, look out!). With a low turnover rate (I just had to rent a car and spent 15 minutes getting the sirius out of my car so I wouldn’t have to drive without it!) you can be fairly sure that the last quarter revs will be the minimum for the next quarter so a 10% increase will be very powerful.
There will be an IPO for CSR – XMSR’s Canada division, that will do well, but Stern was banned from Canadian radio a few years ago and Sirius is already tearing up that market.
