Deutsche Bank analyst Bryan Kraft this week issued a bullish report on SiriusXM, saying the satellite radio company’s stock is mispriced and that upcoming earnings are poised to beat expectations because Wall Street has overlooked growth in digital audio advertising.
Kraft said SiriusXM’s exclusive U.S. audio advertising deal with YouTube has been “completely disregarded” and could generate $2 billion in annual incremental revenue by 2029 at a high-teen margin, lifting EBITDA by $350 million to $400 million. Additional ad growth is expected from an expanded relationship with Amazon’s ad platform announced in July.
“We believe SiriusXM is mispriced based on a large disconnect between consensus estimates and what we believe the company can achieve in 2027 and 2028,” Kraft wrote. “The opportunity is further enhanced by SiriusXM’s return to allocating capital toward share repurchases in the second half of 2026, as well as what we view as conservative 2026 guidance.”
He raised his 2026 forecasts to $8.6 billion in revenue and $2.7 billion in EBITDA, above both his prior estimates and the company’s recently increased guidance of $8.5 billion in revenue and $2.6 billion in EBITDA.
Kraft also expects subscription revenue to remain steady as SiriusXM adds companion subscriptions, more sports programming and a price increase next year.
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| Jennifer Witz |
Beyond operations, Kraft cited the value of SiriusXM’s spectrum holdings, which the FCC may restructure so unused bands can be sold or leased. Berkshire Hathaway has raised its stake to 37% of outstanding shares; buybacks could push that above 50%. Kraft said he does not view any resulting capital-allocation questions as a concern for the investment case.
The report followed news that Howard Stern will return with a weekly show also streamed on HBO Max, while one of his channels will be programmed by Bravo host Andy Cohen. Kraft did not cite Stern in the recommendation.