Sirius XM (NASDAQ: SIRI), a leading provider of satellite radio, is scheduled to announce its fiscal fourth-quarter results on Tuesday, February 1. We expect Sirius XM stock to likely trade higher due to better-than-expected Q4 results with revenue and earnings both beating market expectations. Sirius XM reported a record 616,000 net new SiriusXM self-pay subscribers in Q3 and raised its full-year guidance after hitting its previous subscriber plan of approximately 1.1 million net additions in just nine months. In fact, the company has a long history of providing conservative guidance for revenue, self-pay net subscriber additions, free cash flow, and adjusted EBITDA. The satellite radio company typically raises those guidance figures throughout the year as it did throughout 2021. For the full year, SIRI now expects total revenue of approximately $8.65 billion (up by $150 million from the previous forecast), adjusted EBITDA of $2.75 billion, (up by $80 million from prior estimates), and free cash flow of over $1.8 billion (up $100 million from the prior forecast).
Our forecast indicates that Sirius XM’s valuation is around $7 per share, which is above the current market price of $6. Look at our interactive dashboard analysis on Sirius Earnings Preview: What To Expect in Q4? for more details.
- What To Expect From Sirius’ Q3 After Stock Down 28% This Year?
- What’s Next For Sirius Stock After A 26% Fall This Year?
- Sirius Q2 Earnings: What Are We Watching?
- What To Expect From Sirius XM’s Stock Post Q1?
- Sirius Stock Down 30% So Far in 2023, What’s Next?
- Sirius Stock To Likely Trade Higher Post Q4
(1) Revenues expected to be slightly above the consensus estimates
Trefis estimates Sirius XM’s Q4 2021 revenues to be around $2.3 Bil, marginally ahead of the consensus estimate. The company surpassed expectations on the top and bottom lines in its Q3 earnings with reported revenues of $2.2 billion, up 9% year-over-year (y-o-y), and EPS of 8 cents, up 33% y-o-y. For the full year, we forecast Sirius Revenues to be $8.6 billion, up 8% y-o-y.
(2) EPS likely to beat consensus estimates comfortably
Sirius XM’s Q4 2021 earnings per share (EPS) is expected to be 8 cents as per Trefis analysis, higher than the consensus estimate of 7 cents. In Q3, the company’s operating and net income jumped as operating expenses remained largely flat at $1.6 billion amid the revenue boost. To add to this, the company also announced a 50% boost to its quarterly dividend starting in November. For the full year, we forecast EPS to come in at 31 cents
(3) Stock price estimate higher than the current market price
Going by our Sirius XM’s Valuation, with an EPS estimate of around 31 cents and P/E multiple of around 23.1x in fiscal 2021, this translates into a price of almost $7, which is 13% ahead of the current market price. This represents a P/EBITDA multiple of 15.3x for the company based on our forecast for SIRI’s EBITDA for the current fiscal year.
Note: P/E Multiples are based on Share Price at the end of the year, and reported (or expected) Adjusted Earnings for the full year
It is helpful to see how its peers stack up. SIRI Peers shows how Sirius XM compares against peers on metrics that matter. You will find other useful comparisons for companies across industries at Peer Comparisons.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since 2016.
|S&P 500 Return||-7%||-7%||98%|
|Trefis MS Portfolio Return||-11%||-11%||248%|
 Month-to-date and year-to-date as of 1/31/2022
 Cumulative total returns since the end of 2016