Bank of America Securities analyst Jessica Reif Ehrlich maintained a Sell rating on Sirius XM Holdings yesterday and set a price target of $20.00.
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Jessica Reif Ehrlich’s rating is based on several factors that suggest potential challenges for Sirius XM Holdings. Despite reporting slightly better-than-expected financial results for the third quarter, including revenue and EBITDA figures that surpassed forecasts, there are underlying concerns. The company faces challenges in subscriber growth due to increasing competition and unfavorable market dynamics, particularly among younger demographics.
Additionally, Sirius XM is in the midst of an elevated investment cycle, which is impacting its free cash flow generation. While the company has increased its guidance for 2025 revenue, EBITDA, and free cash flow, the economic backdrop may lead to slower advertising growth. Furthermore, the focus on reducing leverage could result in subdued capital returns. These factors collectively contribute to the Sell rating, as they present potential headwinds for the company’s future performance.
According to TipRanks, Reif Ehrlich is a 4-star analyst with an average return of 9.8% and a 52.66% success rate. Reif Ehrlich covers the Communication Services sector, focusing on stocks such as Fox, Comcast, and Sirius XM Holdings.
In another report released today, Morgan Stanley also maintained a Sell rating on the stock with a $22.00 price target.