Friedman, Billing, Ramsey Reiterates Outperform on XMSR
07/05/2006 : JAGNote by Friedman, Billings, Ramsey & Co., Inc.
From: JAGNotes.com 07/05 10:17:35
XMSR: Reiterate Outperform - The firm noted they believe thatXM is on track to meet or exceed its 8.5 million subscriber guidance. Wereiterate our Outperform rating and $28 price target on XMSR. Our pricetarget is based on our DCF analysis, utilizing a 13% WACC and a 4%terminal free cash flow growth rate.
From: AP 0/7/05 2:28 pm ETAnalyst Upbeat on Satellite FBR Expects XM, Sirius to Continue to Benefit From Proprietary Programming
NEW YORK (AP) -- Friedman, Billings, Ramsey & Co. reiterated "Outperform" ratings for both XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc., saying proprietary programming should continue to lure subscribers. Sales staff at retail outlets that sell the radios "overwhelmingly indicated sports and other non-music programming as key drivers influencing the consumer's decision," analyst Maurice McKenzie said.
That "bodes well" for both companies, he said, "as Sirius airs the 2006 National Football League season beginning in August, and 'Oprah and Friends' premiers on XM in September."
The analyst expects Sirius, whose calling card has been the addition of talk-show host Howard Stern, to add 548,897 subscribers in the current quarter. The company finished the first calendar quarter with 4.08 million subscribers.
McKenzie anticipates XM, which has the rights to Major League Baseball, to grow more slowly, adding 407,752 users to its 6.5 million at the end of March. "Sirius is growing more quickly because of its lower subscriber base," McKenzie said. "But both are adding customers fairly rapidly, and that's because of the programming."
The analyst's note did not bolster the companies' shares Wednesday, as XM slid 30 cents, or 2 percent, to $14.63 in recent trading on the Nasdaq. Sirius shed 11 cents, or 2.4 percent, to $4.50 on the Nasdaq. Earlier Wednesday, Sirius got bad news when automotive supplier Directed Electronics Inc. said the Federal Communications Commission found two Sirius model radios are not in compliance with emissions or frequency regulations.
McKenzie would not comment on that news. He attributed the share-price losses to "volatility associated with companies with emerging business models."
7/05/2006 12:09:00 PM
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