Warren Buffett’s investment company, Berkshire Hathaway, has boosted its investment in Sirius XM Holdings, raising its ownership to 32%. The firm acquired approximately 3.6 million shares for around $87 million through a series of transactions. This development follows the completion of a deal by billionaire John Malone’s Liberty Media, which merged its tracking stock with the remainder of SiriusXM.
As part of the restructuring within Malone’s media conglomerate, the conversion enabled Liberty SiriusXM stockholders to exchange each share for 0.8375 shares of Sirius XM. On September 10, Sirius XM Holdings declared it had embarked on a new era as an independent entity after finalizing its agreement with Liberty Media.
In August, SiriusXM revealed a decline of 100,000 self-paying subscribers in its satellite radio division for the second quarter, a reduction from the 130,000 subscriber loss experienced a year prior. The company’s revenue fell by 3% year-over-year, totaling $2.18 billion.
Berkshire Hathaway increases investment in SiriusXM
Tom Barry, the Chief Financial Officer, stated, “Our core goals include continuous investment in our subscription service by enhancing consumer experiences, broadening advertising prospects, and ensuring healthy profit margins along with strong cash flow. We remain devoted to achieving our financial objectives and implementing our strategic blueprint with accuracy and discipline.”
Experienced trader Ed Ponsi commented on SiriusXM’s purchase of the renowned podcast “Call Her Daddy,” hosted by Alex Cooper, which was reportedly valued at $125 million. Ponsi described the purchase as “a desperate attempt by SiriusXM” and indicated that SiriusXM must keep the focus on Cooper to sustain her relevance and appeal for the investment to yield a return.
JP Morgan recently resumed coverage of SiriusXM with an underweight rating and established a price target of $20. The firm commended the acquisition of Liberty Sirius for enhancing trading conditions and decreasing share count by 12%, yet it expressed worries about SiriusXM’s prospects for sustainable long-term growth in self-paying subscribers. Sirius XM is set to announce its results on October 31. Recently, the company’s stock increased by 8.7%, reaching $27.10, although it has still decreased by 51% year-to-date and is down nearly 44% compared to the previous year.
