NEW YORK (
dipped under $2 this week, raising questions about where the stock is headed for the remainder of the year.
There's no denying that if you got in on Sirius when its shares were selling for a nickel in February 2009, you are now a happy camper. But at least in 2011, how much momentum is left in the stock?
Shares of the satellite radio company have fallen about 18% from its intra-day 52-week high of $2.44 on May 31.
One potential worry is the looming initial public offer of
. The streaming Internet radio service said last week that it anticipates raising as much as $150 million, but Wall Street is whispering that it could generate even more.
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Of course, just how much of a threat Pandora is to Sirius is a highly debated point. On the one hand, they operate in two realms: Pandora for computers and wireless devices, Sirius predominantly in cars. But ultimately both serve the same purpose: to deliver music to users.
There are several other headwinds facing Sirius for the remainder of the year.
The company has been on a path to recovery due, in part, to the success of the Cash for Clunkers program last year, which reinvigorated car sales. But May was a weak month for automakers -- not the news Sirius shareholders want to hear.
Sirius relies on the auto industry to boost subscriber growth. At the end of the first quarter, the company added 373,064 new subscribers, bringing its total to a record of 20.6 million.
According to the Bedford Report, the potential NFL lockout could also limit the expansion of satellite radio.
Other risks for the stock include a pending alleged breach-of-contract suit brought by Howard Stern and his agent, who are seeking retroactive performance payments by including XM subscribers with the Sirius subscriber growth, said Miller Tabak analyst David Joyce.
But Sirius XM does have some catalysts to boost the stock, including the launch of Sirius XM 2.0, the next generation of interactive satellite receivers that are set to debut later this year.
Also, the ability for Liberty Capital to offer to buy the rest of Sirius shares it does not own at some price above the current trading levels is a potential positive, Joyce wrote in a note. "We do not place a probability on this occurring, but we expect the market was extrapolating other consolidation efforts by Liberty Capital and private equity in general."
In light of all this, where do you think Sirius XM will trade by the end of 2011? Take TheStreet's poll and see what other readers are saying.
-- Written by Jeanine Poggi in New York
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