Sirius XM Radio Shows Signs Of Positive Business

Wunderlich Securities has published a research report on Sirius XM Radio SIRI after the company shows signs of positive business despite the expectation for guidance hikes being unlikely in 2011. In the report, Wunderlich writes "We are maintaining our Buy rating on SIRIUS XM Radio (SIRI) and $2 price target, albeit with mild disappointment as to 2011 guidance even as 4Q actuals exceeded our estimates. Barring another significant economic downturn that nullifies a recovery in auto sales to replacement rate or disruptive competition beyond what we anticipate from Pandora, Sirius has about as strong a subscription business model as there is in media land. This is supported by a gaggle of sensitivity analysis with respect to U.S. auto sales, penetration of the previously-owned-vehicle market, (critical to continued share upside) ARPU growth, and the LT disruptive effect of Pandora and other in-car alternatives." As noted above, Wunderlich maintains its Buy rating and $2 price target. Sirius XM Radio closed yesterday at $1.68.