Bank of America Securities analyst Jessica Reif Ehrlich reiterated a Sell rating on Sirius XM Holdings (SIRI – Research Report) today and set a price target of $21.00.
Jessica Reif Ehrlich’s rating is based on Sirius XM Holdings facing several immediate challenges, including increased capital expenditures and leverage, which are impacting its financial outlook. The company is striving to generate $1.5 billion in free cash flow by 2027, but it is currently dealing with subscriber churn and pressures from one-time events like click-to-cancel policies and reduced streaming marketing. Although Sirius XM is making efforts to improve subscriber retention through new pricing and packaging strategies, these challenges are expected to affect subscriber numbers in 2025.
Additionally, the economic environment is contributing to uncertainty in advertising sales, with noticeable softness in consumer product goods, retail, and travel sectors. While Sirius XM’s podcasting portfolio may help mitigate some of the advertising revenue decline, the overall economic backdrop remains a concern. Despite initiatives to reignite subscriber growth, including new subscription packages and pricing transparency, the combination of these factors led to the reiteration of an Underperform rating and a price objective of $21.
According to TipRanks, Reif Ehrlich is a 4-star analyst with an average return of 6.5% and a 51.03% success rate. Reif Ehrlich covers the Communication Services sector, focusing on stocks such as Sirius XM Holdings, Walt Disney, and Spotify.
In another report released on March 25, J.P. Morgan also maintained a Sell rating on the stock with a $20.00 price target.