Benchmark reiterates Buy rating on Sirius XM Radio stock with $28 target
Investing.com
Published Jul 15, 2025 08:31AM ET
Investing.com - Benchmark has reiterated its Buy rating on Sirius XM Radio (NASDAQ:SIRI) stock, maintaining a price target of $28.00. According to InvestingPro analysis, SIRI is currently trading below its Fair Value, with strong returns over the past three months.
The research firm expects Sirius XM to achieve full recovery to near $2.7 billion in Adjusted Operating Income (AOI) by 2028. Benchmark notes that operating results during economic softness are supported by an additional $200 million in targeted run rate savings expected by the end of 2025.
These new savings come on top of approximately $350 million in cost reductions already achieved during 2023-2024, according to the research note.
Benchmark highlights a "likely sustainable double digit free cash yield" as one of the positive factors supporting its rating on the satellite radio provider.
The firm also estimates "mid-30's fair share value" if Sirius XM can return to sustainable low single digit AOI growth, potentially around 2%, through various product and marketing initiatives.
In other recent news, Sirius XM Holdings Inc. reported its financial results for the first quarter of 2025, missing analysts' expectations for both earnings per share (EPS) and revenue. The company posted an EPS of $0.59, which was below the anticipated $0.67, while revenue reached $2.07 billion, slightly under the projected $2.08 billion. Despite these shortfalls, Sirius XM maintained its full-year financial guidance, forecasting $8.5 billion in revenue and $2.6 billion in adjusted EBITDA. The company also announced plans to launch a new ad-supported service tier, aimed at attracting a broader audience. Additionally, Sirius XM achieved significant cost savings and continued to lead in the in-car audio market. The firm reported a net income of $24 million and an adjusted EBITDA of $629 million for the quarter. Analysts from JPMorgan and Evercore ISI noted the company's resilience and strategic efforts in maintaining strong margins amid market uncertainties.
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