Sirius XM Radio Inc (NASDAQ:SIRI) is likely to end the year without the knowledge of its next CEO, according to Liberty Media Corp (Capital) (NASDAQ:LMCA) CEO Greg Maffei. The incumbent chief executive officer of the satellite radio company, Mel Karmazin, is set to leave the company early next year. Sirius XM Radio has already established a CEO search committee, but Maffei said that there is a likelihood that the process will stall, expressing his desire to have a new CEO within six months.
Wall Street Journal quoted Mr. Maffei saying, “We are both looking at internal and external candidates; it’s unlikely to be a one-month process. I would hope it would be [at most six months]”.
Meanwhile, the period in which people are allowed to file petitions against Liberty Media Corp (Capital) (NASDAQ:LMCA)’s acquisition of Sirius XM Radio Inc (NASDAQ:SIRI) has expired, and Maffei believes that the process is almost done and dusted. Only one petition has been filed so far ,while the comment period will be cut off on November 20. Technically, the FCC is the only standing hurdle in the process, as it is expected to take several weeks before making its decision.
The company had aroused optimism from investors by some taking bullish positions on the stock, even before the Q3 earnings were announced. There was high expectations on Sirius XM Radio Inc. (NASDAQ:SIRI), with regard to its earnings, as investors projected an over performance. Nonetheless, the company did not disappoint as it generated record revenues for a satellite radio company, and provided guidance that promises even better results in Q4 and 2013.
One of the main negatives on Sirius XM Radio Inc (NASDAQ:SIRI) sales going into Q4 includes auto sales, as remarked by the outgoing CEO, Karmazin. During the Q3 conference call, Karmazin pointed out that Hurricane Sandy could impact Q4 new car sales negatively.
Morgan Stanley (NYSE:MS) equity research analysts point out that Sirius XM Radio Inc (NASDAQ:SIRI) will benefit from its growing auto sales, compounded by widening profit margins, as the subscriber base soars. The analysts have raised their estimates on the company with a price target of $3.00. They expect the company to beat its 2012 earnings estimates, while 2013 annual revenue estimates are now set at $14.8 million, up from the previous estimate of $14.3 million.
However, the company’s search for a new CEO cannot be allowed to drag on at the back-end of a successful year, as this might hamper the growth trend established during 2012. Analysts even forecast a great degree of improvement in the subscriber base, in 4Q12, but 2013 could be set for better things, if a CEO is found in good time, as Karmazin is set to depart on February 1, 2013.
At the time of this writing, Sirius XM Radio Inc (NASDAQ:SIRI) stock was trading at $2.79 per share, down $0.03, or 0.90% decline from the previous close.