Sirius XM: Bracing For The Tariff Impact
SIRI expands its content portfolio in broadcasting across different interest areas, presenting a compelling investment opportunity for the stock.
Warren Buffett's ability to spot undervalued gems in the stock market helped create tremendous wealth for Berkshire Hathaway shareholders. And he has managed to do so in good economic times as well as uncertain ones.
In the past five years, the S&P 500 index has generated a total return of 130%. Investors who put money behind the widely followed benchmark would've more than doubled their money.
If you doubted the genius of Warren Buffett and his company Berkshire Hathaway in 2024, you certainly aren't doubting it now. While investors continued to pour into stocks last year and take advantage of frothy market conditions, Buffett and his team remained patient and cautious, buying very few stocks and hoarding cash.
Sirius XM Holdings is not a growth stock. Let's get that clear right off the bat and consider them from a contrarian, value, and even growth income perspective. The Liberty Sirius merger simplifies the company's structure, potentially leading to better decision-making and operational efficiency. Despite economic challenges, Sirius XM showed strong performance in 2024, with significant subscriber growth and positive operating cash flow.
Here's a nice icebreaker for your next cocktail party: Ask a fellow investor for their thoughts about Sirius XM Holdings (SIRI -4.49%). The satellite radio provider is going to attract a range of opinions as wide as its programming.
Sirius XM Holdings remains a favorite of Warren Buffett, despite potential pressure from an economic slowdown and ad market weakness in 2025. The radio broadcasting company is focusing on new subscription tiers, including plans to introduce an ad-supported tier to attract more budget-conscious consumers. Buffett's Berkshire Hathaway has increased its stake in Sirius XM to 120 million shares.
On Friday, BofA analyst Jessica Reif Ehrlich reiterated an Underperform on Sirius XM Holdings SIRI with a price target of $21.
Sirius XM offers a predictable revenue stream through its subscription-based model and has strong operating margins and cash flow. Warren Buffett's Berkshire Hathaway owns 35% of SIRI. Despite lower returns on capital recently, the Company has historically had strong capital returns, making it a solid value pick.
This year's market correction sent many stocks sliding, creating opportunities to pick up shares of some good companies at a discount. Sirius XM Holdings (SIRI 1.17%) is one such business, but its stock was struggling well before this latest period of market volatility.
To say that SiriusXM (SIRI 2.09%) has underperformed the stock market would be a big understatement. The stock declined by nearly 60% in 2024 -- a year when the S&P 500 increased by more than 20%.