Deutsche Bank bumped Sirius XM to buy this week, with Bryan Kraft taking his target to $45 in a Sept. 2 note. From Thursday's finish, that price implies a 51% gain. He told Bloomberg, "The stock is trading at a pretty significant discount to its intrinsic value, and as it transforms into a company with a healthy growth rate, we should see a re-rating." He is one of the few bulls on the name right now.
Across the 14 analysts tracked by Bloomberg, five currently rate the shares a buy. Their average target sits near $33, which suggests about 11% upside from here. The stock has rallied nearly 50% so far in 2024, beating the S&P Midcap 400's 14% climb.
Kraft's case leans on two big-tech relationships. First, Sirius XM is set to become YouTube's exclusive US audio ad representative. By Kraft's math, that setup could deliver an additional $2 billion in yearly revenue by 2029 and contribute between $350 million and $400 million of EBITDA. "This alone puts Sirius back into being a growth company," he said. "You almost need to take a step back to appreciate how significant this is, because it isn't factoring into estimates at all yet."
He also points to a deeper tie-in with Amazon's demand-side ad platform as another push for growth across Sirius XM and its Pandora & Off-Platform business.
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Sirius XM posted about $8.6 billion of revenue for 2025, and Bloomberg's consensus models call for low single digit sales growth each year through 2029, reaching $9.1 billion by then. Earnings are projected to rise at or near a double digit pace annually across that stretch, including 30% growth this year. Advertising tied to Sirius XM and Pandora & Off-Platform represented over one fifth of 2025 revenue.
Valuation is part of the pitch. The shares trade around 9 times forward earnings, roughly half the company's 10-year average and below the S&P Midcap 400 near 16 times. As Kraft put it, "Right now the stock's multiple is reflective of a company that isn't growing, but as it starts to execute on these relationships, we expect a re-rating that reflects the positive growth." Translation for your wallet: if those ad partnerships scale the way optimists expect, a stock priced like a slow mover could start getting treated like a grower.
