Sirius XM

(SIRI) - Get Report

shares continued to plummet Wednesday, one day after the satellite radio provider offered a weak outlook on subscriber growth.

Shares were lately down 20 cents, or 17.5%, to 94 cents. A day earlier, the stock fell 9.5% after

Sirius XM

said its subscriber count should increase by a weaker-than-expected 10% in 2009.

The stock is now down 68% for the year -- and more than 49% since the merger between Sirius and

XM Satellite Radio

was finalized July 29.

Only the Bondholders Win Here

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RBC Capital Markets analyst David Bank says the rapid decline in shares is sentiment-driven and there isn't much Sirius XM can do in the near term to change that. "It's going to be execution over time," Bank says. "They're giving pretty decent transparency and they're certainly being helpful to the investment community. They just need to execute it."

Bank argues that the bigger issue is Sirius XM selling a consumer-based product in a very challenged-consumer economy. "This not the kind of environment where the benefit of the doubt goes easily," he says.

The tumbling share price is certainly on the mind of CEO Mel Karmazin. On the company's second-quarter earnings conference call last month, Karmazin took time to address the decline in the share price even in the wake of the merger completion.

"We are well aware that the stock price has suffered. I am not pleased with the market reaction," Karmazin said on Aug. 7. "We know we have a great deal of work to do to have shareholders feel the same way as our other stakeholders feel and we take that responsibility very seriously."

To back up his confident view of the future of Sirius XM, Karmazin purchased 2 million shares of the company at $1.37 three days prior to the earnings announcement. However, in just over one month's time, Karmazin's investment has lost 31% of its value, or $860,000.

The sharp decline must be particularly troubling for Karmazin as it comes after he boosted his estimate of cost savings for the newly merged company in 2009 to $425 million from $400 million, a figure he has trumpeted loudly since the merger was given regulatory approval.

Karmazin also said Tuesday that Sirius XM expects an adjusted loss before interest and investment income, interest expense, depreciation expense, and non-cash stock compensation expense of $350 million in 2008, which is in line with analysts' expectations. The company also reiterated that it should see $300 million in positive adjusted EBITDA for 2009, but that still doesn't appear to be enough to impress Wall Street.

"The company is not generating enough EBITDA in the near-term to put traditional valuation metrics around," says RBC's Bank. "While they are generating some EBITDA, it's really not enough given traditional media multiples to offer that obvious valuation multiple support."