This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Sirius XM Investors Need to Get a Clue

Although Sirius's stock has done well over the past the couple of years, let's not forget what got it there. It hasn't been due to stellar results. Don't forget, Sirius has been actively buying back its stock. And at the same time, Liberty has been buying its way up to majority ownership. Essentially, very little of the stock gains have been organic.

John Malone is now laser-focused on maximizing all of the value that remains in the company. Although Sirius does produce a decent amount of cash flow, the company doesn't have a future against better-run IP-based companies. Apple's (AAPL) iTunes Radio can't be ignored.

Investors are fooling themselves if they don't see that market dynamics are changing. And Sirius does not have a strong track record of innovation. How long can this company live by the mantra "content is king?" Maybe in 2001 that was the case. Not today.

Investors who keep repeating this myth needs to look at the deals Netflix (NFLX) has begun to make with the likes of Time Warner (TWX). Netflix is demonstrating that -- with enough money -- kings can be captured.

The same goes for Amazon (AMZN), which is suddenly interested in the sound of music.

By contrast, aside from a few deals here and there with auto manufactures, what has Sirius ever done to demonstrate it can maintain a foothold inside the car? Let's be honest for moment and stop pretending Sirius is better than its record. Now's not the time to get arrogant.

Investors should thank Liberty that Sirius wasn't a broken record when it was saved.

At the time of publication, the author was long AAPL and held no position in any of the other stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

2 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,295.57 +29.58 0.17%
S&P 500 2,012.86 +1.50 0.07%
NASDAQ 4,587.6920 -5.7330 -0.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs