How Is Sirius XM Spending Its Cash?
Sirius XM is raising substantial debt mainly for the purpose of share repurchases. The company’s outstanding share count is in the order of 5 billion and its stock has been somewhat stable over the past few years. In order to provide some returns to its stock holders and lower its outstanding share count, Sirius is making significant stock repurchases. However, since its cash flow from operations aren’t much compared to the amount of repurchases, the company is financing this through debt. Over the past three years, Sirius has raised close to $7.3 billion in debt and it has repaid just $3.7 billion. During the same time, the company has returned $6.2 billion to shareholders. With Sirius XM’s debt now at $6.1 billion, it may not look to raise further debt, at least not more than it can pay. The company’s cash flow from operations was comparatively low at $500 million last year. However, we expect it to jump significantly going forward, which should place it in a good position to pay off debt.
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Have more questions about Sirius XM? See the links below:
- What’s Sirius XM’s Revenue & Earnings Breakdown In Terms Of Revenue Sources?
- What’s Sirius XM Fundamental Value Based On Expected 2016 Results?
- How Has Sirius XM’s Revenue Composition Changed In The Last Five Years?
- By What Percentage Can Sirius XM’s Revenues Grow Over The Next Three Years?
- By How Much Can Sirius XM’s Subscription Gross Margins Expand By 2020?
- How Much Revenues Can New Sirius XM Subscribers Add By 2020?
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