Analysts have been eager to weigh in on the Communication Services sector with new ratings on Sirius XM Holdings (SIRI – Research Report) and Liber...
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Analysts’ Opinions Are Mixed on These Communication Services Stocks: Sirius XM Holdings (SIRI) and Liberty Media Liberty Formula One (FWONK)
TIPRANKS10-29
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- Cedric77·10-29What Berkshire (or its managers) presumably like 1. Stable subscription-based business Sirius XM has a large base of recurring revenue from subscriptions (satellite radio plus Pandora streaming) rather than one-time sales. Analysts note that over 70-75% of their revenue is subscription based. For a value investor who likes predictability, that’s a plus. 2. Attractive valuation and “margin of safety” The stock was trading at a relatively low multiple (for a business with stable cash flows) when Berkshire began significantly ramping up the position. For example, one write-up noted the shares were trading at about 8× earnings at that time. Value investors like Buffett often say: buy when others are fearful. 3. Large stakeholder position / potential influence / capital return Berkshire holds ~4Report