Analysts Say XM / Sirius Merger is “Imminent” > um

reply to fAcEtIOUs

Re: um

Maybe someone else needs to learn to read income statements and financial information. In real dollars Sirius lost $1,104,867,000 for the period ending 12/31/06. In real dollars XM lost $715,782,000 for the same period according to the reference. Earnings per share do not dilute real dollars and in anybody's book a lost of over 1 billion is more than a loss of 3/4 of a billion. Oh and BTW XM Stock was trading at $15.60 per share and Sirius was at $3.83 per share.

Do everyone a favor and take some accounting courses.

Yes, but you need to understand what market cap. is.

Take the price per share and add the number of outstanding shares for each company. You'll see the market cap. (public worth) of the company.

SIRI - $5.63 Billion
XMSR - $4.90 Billion

Share prices don't indicate everything! In fact, they do not indicate much at all unless your about to be delisted! lol

Sirius and XM aren't going anywhere operating independently, they are adding capital costs because at the rate of subscriber growth they know they will still become profitable eventually. Look a few years back before Stern was signed and brought on.. Sirius was about to hit cash flow positive within the next two quarters but spent $500 million on Stern because they knew it would ramp up sub growth. The same mentality was applied to all forms of programming to ramp sub growth, including advertising dollars. If they needed to, they could cut capital expenditures and be profitable very quickly.

Market cap is current market value of the entities stock price for its issued and outstanding shares. That is the money that stockholders are paying for the stock ownership. It does not fund deficit spending by the entity. The money spent for a share of stock does not go to the issuer on the secondary market. They only get money on initial offering and that is another story all together becasue the company does not get all of the money on an IPO. A Loss is still a Loss no mater how you sugar coat it, a company that continually racks up lossess will not survive no matter its market cap.