Sirius XM Holdings Faces Challenges Despite Strong Q1 2025 Performance, Leading to Sell Rating

Bank of America Securities analyst Jessica Reif Ehrlich has maintained their bearish stance on SIRI stock, giving a Sell rating yesterday.

Jessica Reif Ehrlich’s rating is based on several factors impacting Sirius XM Holdings’ future performance. Despite reporting better-than-expected first-quarter results for 2025, including a smaller self-pay net loss and higher revenue and EBITDA than projected, the company faces ongoing challenges. The management’s guidance for 2025 still anticipates declines in both revenue and EBITDA, and the self-pay net subscriber losses are expected to continue despite some improvements.
Several headwinds are contributing to these challenges, such as reduced marketing efforts for streaming-only services and changes in cancellation policies, which are likely to lead to significant streaming losses. Additionally, the company is experiencing difficulties with its Pandora segment, which continues to lose users, affecting its advertising growth potential. Furthermore, Sirius XM is in an elevated investment phase, impacting its free cash flow generation, and its focus on reducing leverage is expected to limit capital returns. These factors collectively contribute to the Sell rating given by Jessica Reif Ehrlich.

According to TipRanks, Reif Ehrlich is a 4-star analyst with an average return of 4.8% and a 48.17% success rate. Reif Ehrlich covers the Communication Services sector, focusing on stocks such as Spotify, Charter Communications, and Sirius XM Holdings.

In another report released yesterday, Wells Fargo also maintained a Sell rating on the stock with a $16.00 price target.