Warren Buffett’s Berkshire Hathaway Boosts SiriusXM Stake, Sending Shares Soaring
The market reacted enthusiastically to news that Warren Buffett’s investment firm, Berkshire Hathaway, has further increased its stake in SiriusXM Holdings Inc (SIRI). This move sent shares of the satellite radio company soaring on Monday.
According to a recent regulatory filing, Berkshire Hathaway purchased 3,564,059 shares of SiriusXM stock between October 9th and 11th. These purchases, at an average price of $24.33 per share, amounted to roughly $87 million.
This latest investment brings Berkshire Hathaway’s total ownership in SiriusXM to 108,719,088 shares, representing a significant 32% stake in the company.
SiriusXM has faced headwinds in recent months, struggling with declining subscriber growth and stagnant revenue. The company’s stock has dropped by approximately 54% since the beginning of the year.
The company’s most recent quarterly report revealed a 3% decline in revenue to $2.18 billion, driven by a decrease of nearly 100,000 self-pay subscribers. Despite these challenges, SiriusXM is expected to report third-quarter financial results later this month. Analysts currently project earnings of 78 cents per share and revenue of $2.192 billion.
While the recent news about SiriusXM’s subscriber growth may appear concerning, the investment by Warren Buffett’s Berkshire Hathaway suggests a strong belief in the company’s long-term potential. This move provides a vote of confidence amidst current market challenges.
Analysts’ Views Remain Divided
The market sentiment towards SiriusXM remains divided. JP Morgan analyst Sebastiano Petti has reinstated Sirius XM with an Underweight rating and set a price target of $20. Conversely, Benchmark analyst Matthew Harrigan maintained a Buy rating for SiriusXM but lowered his price target from $65 to $43.
Impact on SIRI Stock Price
In response to the news of Berkshire Hathaway’s increased stake, SiriusXM shares surged by 5.21%, reaching $26.23 at the time of publication. This surge highlights the market’s positive reaction to Warren Buffett’s endorsement.
Key Takeaways
* Warren Buffett’s Berkshire Hathaway has significantly increased its stake in SiriusXM.
* The investment comes amidst a challenging period for SiriusXM, marked by declining subscriber growth and slowed revenue.
* Analyst sentiment towards SiriusXM remains mixed.
* The news of Berkshire Hathaway’s investment has boosted SiriusXM’s stock price.
It remains to be seen whether this recent boost will be enough to propel SiriusXM to overcome its current challenges and achieve sustained growth. However, Warren Buffett’s confidence in the company provides a glimmer of hope for investors looking for long-term value.
