Retail demand for satellite radio has slowed recently due in part to high gas prices and deflating hype surrounding ribald radio jockey Howard Stern, according to a new report from Banc of America Securities.
“The ‘true’ growth trajectory is more modest than was implied post first-quarter results,” Banc of America analyst Jonathan Jacoby wrote in a report Monday.
Other factors include lack of ads, products delays and slower MP3 demand.
Jacoby cautioned, however, that just because satellite radio’s retail demand has slackened doesn’t mean that market penetration will ultimately dry up.
That could still be the result, but it’s more indicative of a slower buildup than previously expected, according to the analyst.
Year-over-year satellite radio growth has slowed to 6% in May and 9% in April, down from 26% in March.
These statistics don’t include Wal-Mart (nyse: WMT - news - people ) or direct sales, but still represent a considerable slowdown from the 50% to 100% year-over-year improvements that were the norm during 2005, according to Jacoby.
He now projects the OEM channel to comprise 59% of gross ads, in contrast to his prior estimate of 52%.
Jacoby lowered the price target from Sirius Satellite Radio (nasdaq: SIRI - news - people ) to $4.50 from $5, but said the “implied upside” of the new target is still “relatively modest at 17%.”
The analyst’s new price target for XM Satellite Radio (nasdaq: XMSR - news - people ) is $22, down from $25 – an implied return potential of 70%.
Source: Forbes
TORONTO, June 19 /CNW/ - Canadian Satellite Radio Holdings Inc. (TSX:
XSR.SV) (”CSR”) announces that effective today, its ticker symbol on the
Toronto Stock Exchange (TSX) has been changed to “XSR” as part of a broader
symbol change initiative previously announced by the TSX.
“XSR” replaces the ticker symbol “XSR.SV” previously used on the TSX for
CSR’s Class A Subordinate Voting Shares. There has been no change to the CUSIP
number for these shares.
about Canadian Satellite Radio Holdings Inc.
Canadian Satellite Radio Holdings (CSR) Inc. (TSX: XSR) operates as XM
Canada(TM) through its subsidiary,Canadian Satellite Radio Inc. XM Canada is
the No. 1 satellite radio service in Canada with the best coverage in Canada
offering a unique lineup of premier Canadian and international programming.
XM Canada offers listeners up to 100 channels for Canada’s lowest monthly
subscription fee - $12.99. XM Canada offers the most NHL(TM) games, PGA
TOUR(TM) and Major League Baseball(TM) coverage, the deepest play list, and
news, talk, sports, entertainment and children’s programming. XM Canada
launched its French and English satellite channels for all of Canada and the
United States to hear on November 22, 2005. After next season, XM will become
the exclusive provider of NHL games coverage on satellite radio. As partners,
General Motors of Canada, Honda, Nissan and Toyota will offer XM radios in
more than 80 different models of vehicles for model year 2007.
XM Canada is the only satellite radio provider in Canada to produce
unique Canadian content from a street front studio located at Avenue Road &
Davenport in Toronto as well as another broadcast studio in downtown Montréal.
XM Canada creates unique Canadian content to be broadcast via digital quality
signals in Canada and the United States and has an exclusive Canadian licence
from U.S.-based XM Satellite Radio Inc. (NASDAQ: XMSR), the leading satellite
radio provider in the U.S. with more than 6.5 million subscribers.
To find out more about Canadian Satellite Radio Inc. (TSX: XSR), visit
our website at www.cdnsatrad.com. To subscribe to XM Canada online or for more
information about XM Canada’s programming line-up and radio choice, visit
www.xmradio.ca.
Forward-looking statements
Certain statements included above may be forward-looking in nature. Such
statements can be identified by the use of forward-looking terminology such as
“expects,” “may,” “will,” “should,” “intend,” “plan,” or “anticipates” or the
negative thereof or comparable terminology, or by discussions of strategy.
Forward-looking statements include estimates, plans, expectations, opinions,
forecasts, projections, targets, guidance or other statements that are not
statements of fact. Although CSR believes that the expectations reflected in
such forward-looking statements are reasonable, it can give no assurance that
such expectations will prove to have been correct. CSR’s forward-looking
statements are expressly qualified in their entirety by this cautionary
statement. CSR makes no commitment to revise or update any forward-looking
statements in order to reflect events or circumstances after the date any such
statement is made.
Additional information identifying risks and uncertainties is contained
in CSR’s filings with the Canadian securities regulators, available at
www.sedar.com.
For further information: Richard Rotman, Wilcox Group - Toronto, (416)
203-6666, ext. 2219, rrotman@wilcoxgroup.com; Jason Mercier, Wilcox Group -
Vancouver, (604) 488-1100, ext. 226, jmercier@wilcoxgroup.com