2 Under-$5 Stocks Crying for a Buyout

And it's not just because SIRI counts roughly 3.75 billion outstanding shares. That's a drag, no doubt. Karmazin's answer, of course, is to buy back to shares. And that's the core problem. In an interview with Jim Cramer on Mad Money, the CEO has very little to say about doing anything dynamic to truly power revenue higher going forward:

MEL KARMAZIN: OK. But the fact is that when you have all of this free cash flow you could make -- you use the free cash flow for an acquisition. There is nothing else.

JIM CRAMER: There's nothing.

MEL KARMAZIN: There is nothing, zero, out there that I want. OK. So you're not going to make an acquisition. You could return the capital to shareholders. At the end of this year, at the end of this year, we'll have between a $1.2 billion and a $1.5 billion of cash on our balance sheet. I don't know what to do with it other than to use it as you're characterizing.

Call me crazy, but I think Amazon.com (AMZN) CEO Jeff Bezos and others would beg to differ with what amounts to a lack of vision.

Sirius XM runs in an ultra-competitive space where lines have become blurred. If you consider Sirius XM a satellite radio company, you're taking a rather myopic view. You need to see Sirius XM as part of the broader audio entertainment and new media sectors. These areas run the gamut from powerhouses like Apple and Amazon to upstarts such as Pandora (P) to terrestrial radio companies. Massive reinvestment to evolve, seize opportunity and fuel hyper-growth -- that's the name of the game.

Instead of embracing the attitude of a perpetual start-up, Karmazin runs Sirius XM like a traditional radio company. And that's not a big surprise. Mel is a terrestrial radio guy. And Sirius XM, the product, sounds a lot like AM Radio in its waning years. If Liberty Media gets to call the shots, I have faith it will shift Sirius XM's culture and fully integrate the property -- in synergistic, multiplatform fashion -- with its existing assets and future acquisitions.

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