Long ago and oh so far away
I fell in love with you before the second show
your guitar, it sounds so sweet and clear
but your not really here
it's just the radio.......
I heard a remake of this classic beat Superstar by The Carpenters not too long ago on my favorite XM satellite channel Ethel. It had a new edgy techno feel that was both hauntingly beautiful and familiar. I started to blink away tears when I heard it. On Ethel I know that I can find the edgy and the alternative that my heart craves. It's music like this that keeps me tuned into my XM channels, that, the superior sound and the lack of commercials (on 69 0f the 170 channels). Really, It was love at first sound! To me it's worth the annual subscription price of $143.00.
"If you love it so much, why don't you marry it?"
"O.K., I will."
I decided to look into Satellite Radio as a stock pick and was slightly shocked at what I found. The analysts opinions on XM Satellite Radio Holdings, symbol XMSR, were all over the place with most of them being in a neutral position not really recommending it but, not actually dissing it either. Today, they are leaning toward a buy position.
There is a friendly merger between Sirius Satellite and XM satellite that has been going on for over a year and it has been held up by the Department of Justice and the Federal Communications Commission. They need to approve the merger. The Federal agencies have a fear that combining the two companies will create a monopoly in the medium and hurt competition for consumers. I don't believe so. You can easily switch over to FM/AM, your CD player, your Ipod, your DVD player etc,etc...... I am optimistic that it will go through eventually. In my opinion, they need to merge for both to survive and thrive at all.
In the event of a merger you want to look at the company that is being bought, this is the stock that will rise--if it's a good fit and can benefit the company acquiring it. In this case XM is the one being bought.
I took a look at the financial statements and ratios of both companies and understand why the analyst opinions are so varied. Presently XMSR stock is at $11.35 a share with a beta of 1.2 which makes the stock slightly riskier than most. It has increasing annual Revenue which is good but, their Expenses are so high that it entirely wipes their Net Income. It might just be the nature of the satellite radio medium though--Sirius had similar results. XM has no P/E ratio or dividend, which isn't uncommon for a fairly young company. I would classify it as a highly speculative stock investment.
I ended up picking up fifteen shares of XM but, they say that love is blind.
O.K. so, I did marry it but, there was a shotgun involved and I might get an annulment by the end of the year--but, at least I was wearing underwear!
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