LSXMB - Is Liberty SiriusXM Group Stock a Buy?
Holiday shopping season is just around the corner, and now might be a good time to go over a way to cash in on the success of Sirius XM Radio (NASDAQ: SIRI) at a discount. Every day is Black Friday for investors in Liberty SiriusXM (NASDAQ: LSXMA) (NASDAQ: LSXMB) (NASDAQ: LSXMK), the Liberty tracking shares that own a majority stake in the satellite radio giant for less than what the stake is currently worth. Let's work the math -- and leave you with a caveat -- but ultimately get into why Sirius XM and Liberty SiriusXM are compelling buys right now.
Liberty SiriusXM owns a 71.5% stake in Sirius XM, and that position -- based on Sirius XM's current market cap of $30.1 billion -- is presently worth $21.5 billion on the open market. Liberty Sirius XM has a $15.2 billion market cap. Pad that with $950 million in debt it has independently of the long-term debt on its books as a part of Sirius XM and you arrive at $16.15 billion, a slightly-better-than-25% discount to owning Sirius XM outright.
Image source: Sirius XM Holdings.