SIRIUS XM HOLDINGS INC. (SIRI): what the price assumes
boothcheck covers SIRIUS XM HOLDINGS INC. (SIRI) but does not put one priced-in number on it: here the defensible answer is the evidence rather than a point estimate. boothcheck publishes no house fair value, target price, or buy/sell rating. Narrative composed 2026-06-28.
Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/SIRI
Headline
| Field | Value |
|---|---|
| Ticker | SIRI |
| Company | SIRIUS XM HOLDINGS INC. |
| Current price | $30.70/sh |
| Composition | Subscriber revenue 76% / Advertising revenue 21% / Other revenue 4% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 13.4% |
| Operating margin today | 19.1% |
| Margin compression (value-band) | -5.7pp |
| Multiple paid | 10x operating income |
The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.
Solve inputs: computed at a 7% cost of capital with 4% terminal growth over a 5-year stage (computed at the 7% minimum rate; the CAPM rate 6.5% sits below it).
Reconcile: at the x-ray's 9.3% required return this reads ~-3.5%/yr; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -0.64σ |
| cohort percentile (of 34 peers) | 18 |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by asset-based and earnings-power and relative-multiple and growth-DCF value. A value/asset-supported name, not a pure growth bet.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 1.24x | 5 | expensive |
| Earnings | 1.14x | 5 | expensive |
| Relative | 0.56x | 2 | justifies |
| Growth | 0.58x | 5 | justifies |
Families that justify the price: Asset, Earnings, Relative, Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 5.3%); the inversion above states its own rate.
Per-Model Detail (n=17)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $86.69 | 0.35x | yes | FCF base $1.5B, growth 0% (input: historical growth), terminal g 0.5%, WACC 5.3%, 5yr projection |
| DCF Exit Multiple | Growth | $53.37 | 0.58x | yes | Exit EV/EBITDA: 6.8x / 8.8x / 10.8x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | — | — | no | P/E 14x (static sector reference · 2026-04), scenarios: 11.9x / 14.0x / 16.1x (bear / base = reference held flat / bull), EV/EBITDA 9x |
| Simple DDM | Growth | $61.45 | 0.50x | yes | DPS $1.06, g=7.4% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $35.30 | 0.87x | yes | Stage 1: 18% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $27.82 | 1.10x | yes | BV/sh $34.82, ROE (TTM) 7.4%, ke 9.3% |
| Two-Stage Excess Return | Asset | $24.75 | 1.24x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $25.93 | 1.18x | yes | Rev $8.6B, growth 0% (input: historical growth; tapered), Terminal P/S: 1.0x / 1.2x / 1.4x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $45.54 | 0.67x | yes | EPS $2.49, growth 18% (input: historical EPS growth), PEG=0.65 (Undervalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $102.67 | 0.30x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $2.52B × (1−23%) / WACC 5.3% → EPV (no growth) |
| Residual Income | Asset | $24.29 | 1.26x | yes | BV $34.82 + 5yr PV of (ROE (TTM) 7.4% − Kₑ 9.3%) × BV; BV grows 4.8%/yr |
| Graham Number | Asset | $44.17 | 0.70x | yes | √(22.5 × EPS $2.49 × BVPS $34.82) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | — | — | no | EBITDA $2.24B × sector EV/EBITDA 9.0x |
| FCF Yield | Earnings | $21.83 | 1.41x | yes | FCF $1549.0M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $15.95 | 1.92x | yes | SBC-adj FCF $1.36B (FCF $1.55B − SBC $0.19B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $80.34 | 0.38x | yes | EPS $2.49 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $11.22 | 2.74x | yes | BV $34.82 × (ROIC 1.7% / WACC 5.3%) |
| P/Sales Sector | Relative | — | — | no | Revenue $8.60B × sector P/S 2.0x |
| PEG Fair Value | Relative | $68.30 | 0.45x | yes | EPS $2.49 × (PEG 1.5 × growth 18.3% (input: historical EPS growth)) → PE 27.4x |
| Earnings Yield | Earnings | $26.92 | 1.14x | yes | EPS $2.49 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Economic-Unit Decomposition (Sum Of The Parts)
One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.
| Unit | Role | Valuation basis | Revenue | Reported profit | Value evidence | Status |
|---|---|---|---|---|---|---|
| SiriusXM | operating | enterprise | $6.4b | — | withheld | unresolved no unit value |
| Pandora and Off-platform | operating | enterprise | $2.1b | — | withheld | unresolved no unit value |
No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.
Solvency
| Field | Value |
|---|---|
| Net debt | $9.3b |
| Net debt / NOPAT (after-tax) | 7.37x |
| Net debt / operating income (pre-tax) | 5.65x |
| Interest coverage | 3.7x |
| Share count CAGR (buyback) | -45.9% |
| Burning cash | no |
Bullet Takeaways
- SiriusXM runs two businesses under one roof: a satellite-radio subscription service with a captive in-car audience, where self-pay monthly churn ran about 1.6% in 2024, and the ad-supported Pandora and off-platform business that competes directly with streaming.
- The price pays only about 10 times through-the-cycle operating income, low enough that it sits below what even a slow decline in operating profit would justify, so the market is treating this as a melting-ice-cube cash generator rather than a grower.
- The dominant risk is the debt: net debt of about $9.6 billion runs more than five times operating income with interest coverage near four times, which is why the free cash flow story, guided to about $1.35 billion for 2026, matters more here than the revenue line.
Bull Case
The bull case is a cash-flow and balance-sheet story, and it starts with how sticky the satellite business actually is. SiriusXM's self-pay monthly churn ran about 1.6% in both 2024 and 2023, a low rate that reflects how embedded the service is in the car: a subscriber who got the radio with the vehicle and listens daily on the commute is expensive to lose and cheap to keep. The first quarter of 2026 pushed that further, with churn improving to roughly 1.5%, the lowest first-quarter level in the company's history, and self-pay subscriber losses narrowing by about 192,000 compared with the prior year on growing adoption of companion subscriptions. A subscription base that churns this slowly throws off predictable, recurring cash.
That cash is the whole point at this price. Free cash flow more than tripled year over year in the first quarter to $171 million on higher adjusted EBITDA and lower capital spending, and management reaffirmed full-year 2026 guidance of about $8.5 billion in revenue, about $2.6 billion in adjusted EBITDA, and about $1.35 billion in free cash flow. Against a price that pays only about 10 times through-the-cycle operating income, that free cash flow yield is substantial, and it funds a meaningful dividend. The bull case for a slow-growth subscription business is not that it grows; it is that it converts a stable subscriber base into cash and returns it.
The valuation pattern supports the read. The relative-multiple and cash-flow methods land at or near the price, justifying it, while only the earnings-power lens calls it expensive. For a business the market has written off as declining, a price that the peer multiples and forward-cash-flow methods already defend is not a demanding setup. The advertising side adds optionality: if Pandora and the off-platform business stabilize their listener hours, the ad revenue that has been under pressure becomes a second lever on top of the subscription cash engine. The bull does not need the company to grow; it needs the cash flow to hold and the debt to come down, and the guidance says both are tracking.
Bear Case
The structural truth a holder has to face is that the core business is a subscription product tied to a shrinking captive moment, the time people spend listening to radio in their cars. SiriusXM's own 10-K describes a media landscape evolving "rapidly, with a steady emergence of new media platforms that compete with both our SiriusXM and Pandora services", and notes that the company's growth has historically depended on "purchasers and lessees" of new vehicles. As in-car listening shifts toward streaming over connected systems, the funnel that fed satellite subscriptions narrows. The Pandora side is already feeling it: the filing attributes "fewer listener hours and fewer available advertising spots" to the shift in listening, contributing to advertising revenue declines. This is a business defending a position, not expanding one, and self-pay subscribers still fell by about 111,000 in the most recent quarter even at record-low churn.
The debt is what turns a slow decline into a real risk. Net debt of about $9.6 billion runs more than five times operating income, with interest coverage near four times. A business that is gently shrinking can still service that debt comfortably as long as cash flow holds, but the leverage removes the margin for error: a faster-than-expected erosion in subscribers or a deeper advertising downturn would compress the free cash flow that both services the debt and funds the dividend. The free cash flow guidance of about $1.35 billion for 2026 is healthy, but a levered business is only as safe as the durability of that number, and the trend in subscribers is down.
The price reflects much of this, which is the bear's honesty. At about 10 times through-the-cycle operating income, the market is not pricing growth; it is pricing managed decline plus cash return. The risk is not that the price is too high against current cash flow; it is that the cash flow itself proves less durable than the multiple assumes. If new-vehicle penetration of streaming accelerates and the satellite funnel narrows faster, the through-cycle operating margin of about 21% that the valuation rests on drifts lower, and a levered, slowly declining business re-rates down rather than holding. The bear is patience risk married to leverage: cheap can stay cheap, and here cheap also carries $9.6 billion of debt.
Valuation
At today's price the market pays only about 10 times through-the-cycle operating income, a multiple so low that the price sits below what even a 5%-a-year decline in operating profit would warrant. That is the bound, not a solved growth rate. The market is not asking SiriusXM to grow; it is pricing the business as a cash generator in gentle decline, and the figure uses the company's own through-the-cycle margin of about 21% on current revenue rather than the depressed trailing quarter, because the trailing line understates the normalized earnings power.
The valuation methods split in a telling way. The relative-multiple and forward-cash-flow methods land at or near the price, defending it; the asset-value lens sits modestly above; and the earnings-power methods call the price expensive. When the peer-multiple and cash-flow lenses already support the price, the stock is not a stretched bet on expansion. It is priced as a slow-declining subscription business that converts a stable base into free cash flow, which is exactly what the guidance describes: about $8.5 billion in revenue, about $2.6 billion in adjusted EBITDA, and about $1.35 billion in free cash flow for 2026.
Solvency is the variable that dominates the downside here, and it cuts against the cheap multiple. Net debt of about $9.6 billion runs more than five times operating income, with interest coverage near four times. That is a manageable load for a stable cash generator but a heavy one if the cash flow erodes, because the debt has the first claim on the free cash the equity story depends on. The right way to read this price is therefore conditional: the relative and cash-flow methods justify it as long as the through-cycle cash flow holds, and the leverage is the amplifier that would punish any acceleration in subscriber decline. The decisive number is not the multiple; it is the durability of the $1.35 billion of free cash flow against $9.6 billion of debt.
Catalysts
SiriusXM reported first-quarter 2026 results on April 30, 2026, with revenue up 1% to $2.09 billion as higher advertising and subscription price increases offset modest subscriber declines. The standout was profitability and cash: free cash flow reached $171 million, more than triple the prior-year quarter, on higher adjusted EBITDA and lower capital expenditures. Self-pay subscribers fell by about 111,000, an improvement of roughly 192,000 versus the prior-year period, helped by companion subscriptions adding about 124,000.
Churn is the operating metric to watch, and it moved the right way. Self-pay monthly churn improved to about 1.5%, the lowest first-quarter level in the company's history, driven by lower vehicle-related and non-pay churn and partly offset by higher voluntary churn. For a subscription business defending its base, a falling churn rate is the clearest sign the core is stabilizing even as gross additions face a tougher new-vehicle funnel.
Management reaffirmed its full-year 2026 outlook: revenue of about $8.5 billion, adjusted EBITDA of about $2.6 billion, and free cash flow of about $1.35 billion. The free cash flow figure is the one that matters most given the debt load, because it funds both deleveraging and the dividend. The advertising trajectory at Pandora and the pace of subscriber stabilization are the two inputs most likely to move the cash flow line through the rest of the year.
Peer Cohorts (Per Segment, With Filing Citations)
SiriusXM (reported)
- SPOT (Spotify Technology S.A.)
- FY2025 20-F: , an increase of 10% from December 31, 2024 to December 31, 2025, and the rest of the world, with 37% of our MAUs, an increase of 21% from December 31, 2024 to December 31, 2025. Our Ad-Supported Users and Premium Subscribers spend significant time engaging with our Service. Combined, our audience streamed 211 billion…
- FY2025 20-F: …markets, the Premium Service provides eligible users with limited online and offline streaming access to a catalog of audiobooks, with an optional Audiobooks+ recurring add-on introduced in 2025 that allows Premium Subscribers to unlock additional hours of audiobook listening per month beyond the base plan. In select…
- TME (Tencent Music Entertainment Group)
- FY2025 20-F: …ads membership, standard membership, and SVIP membership. Benefiting from deepened collaborations with music labels, artists and the rollout of new, high-valued benefits, the number of SVIP subscribers exceeded 20 million as of December 31, 2025. See "- How we generate revenue- Online music services - Music…
- FY2025 20-F: …superior audio fidelity and louder speaker volumes, we let users easily transform their smartphones into portable speakers. Furthermore, we have introduced the Automix intelligent song transition feature and the upgraded One‑Tap DJ 2.0, adding four distinctive styles including Vietnamese percussion, pairing with a…
- NFLX (Netflix, Inc.)
- FY2025 10-K: …2025-12-31 0001065280 us-gaap:FairValueInputsLevel2Member nflx:FourPointSixTwoFivePercentSeniorNotesMember us-gaap:SeniorNotesMember 2024-12-31 0001065280 nflx:SixPointThreeSevenFivePercentSeniorNotesMember us-gaap:SeniorNotesMember 2024-12-31 0001065280 nflx:SixPointThreeSevenFivePercentSeniorNotesMember…
- FY2025 10-K: SeniorNotesMember 2025-12-31 0001065280 us-gaap:FairValueInputsLevel2Member nflx:FivePointEightSevenFivePercentSeniorNotesMember us-gaap:SeniorNotesMember 2024-12-31 0001065280 nflx:ThreePointZeroPercentSeniorNotesIssuedApril2020Member us-gaap:SeniorNotesMember 2024-12-31 0001065280…
- WBD (Warner Bros. Discovery, Inc.)
- FY2025 10-K: …wbd:DiscoveryCommunicationsLLCMember us-gaap:SeniorNotesMember 2024-12-31 0001437107 wbd:SeniorNotesDue20475.200Member wbd:DiscoveryCommunicationsLLCMember us-gaap:SeniorNotesMember 2024-12-31 0001437107 wbd:SeniorNotesDue20495.300Member wbd:DiscoveryCommunicationsLLCMember us-gaap:SeniorNotesMember 2024-12-31…
- FY2025 10-K: …2024-01-01 2024-12-31 0001437107 us-gaap:OperatingSegmentsMember wbd:DistributionRevenueMember wbd:StudiosSegmentMember 2024-01-01 2024-12-31 0001437107 us-gaap:OperatingSegmentsMember wbd:DistributionRevenueMember wbd:GlobalLinearNetworksMember 2024-01-01 2024-12-31 0001437107 wbd:CorporateAndEliminationsMember…
- ROKU (Roku, Inc.)
- FY2025 10-K: :CustomerBMember us-gaap:CustomerConcentrationRiskMember us-gaap:SalesRevenueNetMember roku:DeviceSegmentMember 2024-01-01 2024-12-31 0001428439 roku:CustomerBMember us-gaap:CustomerConcentrationRiskMember us-gaap:SalesRevenueNetMember roku:DeviceSegmentMember 2023-01-01 2023-12-31 0001428439 roku:CustomerCMember…
- FY2025 10-K: …and ultimately driving monetization. We are successfully growing The Roku Channel audience internationally. The Roku Channel is available on devices powered by the Roku TV OS in the United Kingdom, Canada, and Mexico. With strong scale and engagement, we are working to grow monetization in Mexico and Canada. Mexico…
Pandora and Off-platform (reported)
- SPOT (Spotify Technology S.A.)
- FY2025 20-F: …of intellectual property registration, employee or third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods. Seasonality See "Item 5.D. Trend Information" for a description of the seasonality of our business. Competition We face robust, complex,…
- FY2025 20-F: …on access that would materially affect our ability to access those platforms. In particular, where the owner of a platform is also our direct competitor, the platform may attempt to use this position to affect our access to users and ability to compete. For example, an online platform might arbitrarily remove our…
- TME (Tencent Music Entertainment Group)
- FY2025 20-F: …over the contract period of display based on a time-based measure of progress as the performance obligation is expended evenly over the period, while revenue from the CPM arrangements are recognized based on the number of times that the advertisement has been displayed. The Group allocates revenue to each performance…
- FY2025 20-F: …its various performance obligations by providing services throughout the subscription period and the majority of subscription revenue is recognized over time accordingly. The Group also provides its users to purchase early release access to certain new digital music singles and albums. These singles and albums can be…
- ROKU (Roku, Inc.)
- FY2025 10-K: …us to operate. In addition, we distribute our streaming services on platforms other than our own streaming platform, and we may not be successful in attracting a large number of users or generating significant revenue from advertising or subscription fees on such other streaming platforms. The sale of Premium…
- FY2025 10-K: …less attractive to advertisers and partners, and harm our ability to grow our revenue, particularly our Platform revenue which depends on effective delivery of advertising campaigns. We are continuing to assess the impact of new and proposed privacy and data protection laws on our business. 28 Table of Contents Any…
- TTD (TRADE DESK, INC.)
- FY2025 10-K: …impression counts and related disputes and customer collections could impact our business and reputation. In 2025, the global digital advertising ecosystem saw a large increase in supply (ad impression opportunities). Supply growth has meaningfully outpaced demand growth. Overall, we believe this is a positive…
- FY2025 10-K: …from use of our platform. We also have expenses denominated in currencies other than the U.S. Dollar. Given our anticipated international growth, we expect the number of transactions in a variety of foreign currencies to continue to grow in the future. While we generally require a fee from our clients that pay in…
- MGNI (MAGNITE, INC.)
- FY2025 10-K: . If the breach is material, we will be subject to additional SEC disclosure requirements, which may harm our brand, reputation, or overall business. Failure to detect or prevent fraud, intrusion of malware through our platform into the systems or devices of our clients and their customers, or other actions that…
- FY2025 10-K: …all of their header-bidding advertising inventory. We believe that adoption and proliferation of these tools will further strengthen our relationship with sellers and contribute to our future revenue growth. Transparency and Controls We generate revenue each time an impression is monetized on our platform based on a…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
SIRI Q1 2026 results, April 30 2026 · SIRI 2026 guidance, April 30 2026