Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A-. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, notable return on equity, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 1.2%. Since the same quarter one year prior, revenues rose by 11.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- Compared to its closing price of one year ago, SIRI's share price has jumped by 78.14%, exceeding the performance of the broader market during that same time frame. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Media industry and the overall market, SIRIUS XM RADIO INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has significantly increased by 322.83% to $168.92 million when compared to the same quarter last year. In addition, SIRIUS XM RADIO INC has also vastly surpassed the industry average cash flow growth rate of 0.20%.
- The debt-to-equity ratio is somewhat low, currently at 0.64, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.19 is very weak and demonstrates a lack of ability to pay short-term obligations.
Sirius XM Radio Inc. provides satellite radio services in the United States and Canada. The company broadcasts music, sports, entertainment, comedy, talk, news, traffic, and weather channels on subscription fee basis through two satellite radio systems. Sirius XM Radio has a market cap of $22.8 billion and is part of the services sector and media industry. The company has a P/E ratio of 7.00, below the S&P 500 P/E ratio of 18.00. Shares are up 23.9% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.
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