Critical Survey: Sirius XM (SIRI) versus Emmis Communications (EMMS)

Sirius XM (NASDAQ:SIRI) and Emmis Communications (NASDAQ:EMMS) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Institutional and Insider Ownership

17.3% of Sirius XM shares are owned by institutional investors. Comparatively, 35.3% of Emmis Communications shares are owned by institutional investors. 0.8% of Sirius XM shares are owned by insiders. Comparatively, 32.3% of Emmis Communications shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Sirius XM and Emmis Communications’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sirius XM $5.43 billion 5.15 $647.90 million $0.20 31.10
Emmis Communications $148.49 million 0.34 $82.12 million N/A N/A

Sirius XM has higher revenue and earnings than Emmis Communications.

Profitability

This table compares Sirius XM and Emmis Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sirius XM 15.64% -78.49% 13.79%
Emmis Communications 28.32% 41.04% 13.74%

Risk and Volatility

Sirius XM has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500. Comparatively, Emmis Communications has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500.

Dividends

Sirius XM pays an annual dividend of $0.05 per share and has a dividend yield of 0.8%. Emmis Communications does not pay a dividend. Sirius XM pays out 25.0% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Sirius XM and Emmis Communications, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sirius XM 4 6 4 0 2.00
Emmis Communications 0 0 0 0 N/A

Sirius XM presently has a consensus target price of $6.84, indicating a potential upside of 9.96%. Given Sirius XM’s higher possible upside, equities analysts clearly believe Sirius XM is more favorable than Emmis Communications.

Summary

Sirius XM beats Emmis Communications on 9 of the 14 factors compared between the two stocks.

About Sirius XM

Sirius XM Holdings Inc. provides satellite radio services in the United States. The company broadcasts music plus sports, entertainment, comedy, talk, news, traffic, and weather programs, including various music genres ranging from rock, pop and hip-hop to country, dance, jazz, Latin, and classical; live play-by-play sports from principal leagues and colleges; multitude of talk and entertainment channels for various audiences; national, international, and financial news; and limited run channels. It also streams music and non-music channels over the Internet; and offers applications to allow consumers to access its Internet radio service on smartphones, tablets, computers, home devices, and other consumer electronic equipment. In addition, the company distributes satellite radios through the sale and lease of new vehicles; and acquires subscribers through the sale and lease of previously owned vehicles with factory-installed satellite radios. Its satellite radio systems include satellites, terrestrial repeaters, and other satellite facilities; studios; and radios. Further, the company provides satellite television services, which offer music channels on the DISH NETWORK satellite television service as a programming package; Travel Link, a suite of data services that include graphical weather, fuel prices, sports schedule and scores, and movie listings; real-time traffic services; and real-time weather services. Additionally, it offers location-based services through two-way wireless connectivity, including safety, security, convenience, maintenance and data services, remote vehicles diagnostics, and stolen or parked vehicle locator services. The company also sells satellite radios directly to consumers through its Website, as well as through automakers and retailers. The company was founded in 1990 and is headquartered in New York, New York. Sirius XM Holdings Inc. is a subsidiary of Liberty Media Corporation.

About Emmis Communications

Emmis Communications Corporation, a diversified media company, engages in radio broadcasting activities in the United States. The company operates in three segments: Radio, Publishing, and Corporate & Emerging Technologies. It operates 11 FM and 3 AM radio stations in New York, Los Angeles, Indianapolis, and Austin, as well as publishes Indianapolis monthly magazine. The company also develops and licenses TagStation, a cloud-based software platform that allows a broadcaster to manage album art, meta data, and enhanced advertising on its various broadcasts; and develops NextRadio, a smartphone application that marries over-the-air FM radio broadcasts with visual and interactive features on smartphones. In addition, it provides Dial Report that offers radio advertising buyers and sellers big data analytics derived from radio station network, smartphone usage, location-based data, listening data, and demographic and behavioral attributes; and engages in dynamic pricing business. Emmis Communications Corporation was founded in 1981 and is based in Indianapolis, Indiana.

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