From this morning's STREET.COM a surprising sober assessment of stock technicals in lay language: --------------------------------------------- 4. Howard Stern Dishes It Out
This has truly been an earth-shattering week for Sirius Satellite Radio (NasdaqNM:SIRI - News). Let's just hope it's not a piggybank-shattering one.
Lab's Stern Warning Sirius is burning up the cash
On Wednesday, the subscription radio service announced a deal under which radio phenom Howard Stern will be an exclusive Sirius broadcaster starting in January 2006.
For the satellite radio business, this strikes us as a pivotal moment in programming. Stern could do for satellite radio what HBO did for cable TV: lure audiences with something they just can't get on the free broadcast medium.
And the deal isn't so bad for Stern, either. He gets the uncensored-by-the-FCC freedom he wants; he also gets a huge portion, we assume, of the $100 million a year that Sirius says the Stern gang will cost the company.
We note, however, that Sirius, still in start-up mode, is a cash-burning machine, on track to vaporize $270 million in 2004 alone. At that rate, Sirius will have run through its $634 million kitty sometime in November 2006 -- about 11 months after Stern first shows up for work.
Yes, we know that Sirius believes it will be able to add the million subscribers it needs to cover the cost of hiring Stern. But who knows?
You'd best play it safe, Howard: If you get your paycheck on a Friday, don't be waiting until Monday to walk it over to the bank