Jim Gilles of the Motley Fool (I dont care if its successful. What a dumb name.) has picked a winner for worst stock of 2008. As if radio hasn't been kicked in the face enough….
its cash burn, and the impossibility of meeting its massive immediate
debt obligations, pushes it into the embrace of bankruptcy. Or it
dilutes existing shareholders into oblivion if, by some miracle, it
persuades its creditors to accept increasingly worthless stock in lieu
of actually paying them back.
Thanks. What the hell did he expect? The economy collapsed, sending millions of people to the bosom of unemployment checks, and Sirius XM is selling a luxury item. Of course they aren't doing so hot. People who are trying to decide between lights or cable are not reliable to purchase Satellite radio.
Proponents of Satellite radio will cite the quality of the service, and that is not even debatable. The absolute creme de la creme of the radio industry reside in Satrad. But that's not the point. It really doesn't matter if Howard Stern is hitting it out of the park every morning when people can't afford the extra expense.
Having said that, I know some of the people at Sirius. This news really sucks for them.