Sirius XM maintains steady stock target and buy rating on first-quarter results

On Tuesday, Pivotal Research maintained a buy rating and $4.90 price target for Sirius XM (NASDAQ: ) by the end of 2024. The satellite broadcaster's first-quarter results showed out-of-pocket subscriber numbers in line with expectations, while revenue and EBITDA growth slightly exceeded expectations.

Revenue rose 0.8% primarily due to the company's Pandora (OTC:) assets, which generate revenue from programmatic advertising.

The company reported EBITDA growth of 4%, beating analysts' initial forecast of no growth. This positive result was partly due to strong performance in areas other than user numbers. While expected churn is slightly higher in 2024, average revenue per user (ARPU) increases and cost savings offset this, resulting in no material changes to forecasts for revenue, EBITDA or free cash flow for the year.

Pivotal Research remains optimistic about Sirius XM, anticipating investments made in the second half of 2023 to enhance Sirius XM's off-car applications and personalized marketing will yield more substantial results in the second half of 2024. Contribute to the company's future financial and operating metrics.

Pivotal Research's end-2024 stock price target of $4.90 reflects Sirius XM's stable outlook, and the company reiterated a buy recommendation. This target remains consistent despite adjustments to churn forecasts and the positive impact of ARPU and cost savings adjustments.

All in all, Sirius XM managed to meet user count expectations thanks to its Pandora assets while slightly beating first-quarter revenue and EBITDA growth forecasts. Pivotal Research continues to give the stock a Buy rating and a solid year-end 2024 price target, anticipating future gains from the company's continued investment.

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Investment Professional Insights

As Sirius XM (NASDAQ: SIRI ) continues to carve out a niche in the highly competitive audio entertainment space, the latest data from InvestingPro provides a deeper financial perspective on the company. Sirius XM currently has a market capitalization of $11.44 billion and a price-to-earnings ratio of 9.19, which makes its valuation attractive compared to its near-term profit growth potential.

The company's adjusted price-to-earnings ratio was slightly lower at 8.67 in the trailing 12 months to Q4 2023, suggesting the market's assessment of its profitability may be more favorable.

InvestingPro Tips highlights a few key points: Sirius XM is trading near its 52-week low, which may be of interest to value-seeking investors. The stock has experienced significant declines over the past three months, with a total price return of 37.39%.

This could present potential opportunities for investors if they believe in the company's ability to rebound. Furthermore, analysts predict that the company will remain profitable this year, driven by its strong earnings record over the last twelve months.

For those who want to learn more, there are other InvestingPro tips available at can use coupon codes PRONEWS24 Annual or year-to-year subscriptions to Pro and Pro+ can enjoy an additional 10% discount, unlocking more comprehensive analysis and insights to help make smarter investment decisions.

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