Tuesday, January 09, 2007

The Sirius Price Action At Close

January 10, 2007

If you follow Sirius you saw some selling on heavy volume happen as the trading day closed out. Now this is only my opinion, but Stern likely sold enough shares to cover the taxes on his latest incentive.

A prudent financial advisor would likely advise that Stern sell enough shares to cover the taxes on his capital gain. A prudent financial advisor would likely advise that the funds from the sale be placed in an extremely conservative location (bank, CD, etc.).

Thus, it is quite possible that Stern indeed sold at least enough shares to cover his tax liability.

The registration for the sale of all shares is typical, and is similar to what was filed last january on behalf of Stern. This documentation is filed simply to give him the right to sell shares as he so desires.

Througout the beginning of 2006, many made an incorrect assumption that Stern sold all of the 34.3 million shares he was issued. Today's SEC filing clearly shows that he held on to 17.5 million shares.

Thus, if Stern were to follow suit with last years behavior, he would likely sell enough to cover his taxes (a bit less than half).

If this was the case, and given the volume in at the end of the day, he could well be done with his selling activity.

When a big seller stops selling (as may be the case here), the stock tends to quickly stabalize.

1/09/2007 10:25:00 PM

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