Liberty Media Corp.
) reported strong financial results for the second quarter of 2012
outpacing the Zacks Consensus Estimates. We believe the company's
recent decision to spin-off Starz LLC segment will enable to it to
raise its stake in
SIRIUS XM Radio Inc.
Barnes & Noble Inc.
Live Nation Entertainment Inc.
). We believe SIRIUS XM will be the key player in the company's
growth story based on rising auto industry sales.Liberty Media is
currently trying hard to take full control of SIRIUS XM.
Liberty Media has filed a new application to the U.S. Federal
Communications Commission, in which the company stated its
intention to acquire more than 50% of SIRIUS XM, so that it can
take full control of the Board of SIRIUS XM. Liberty Media withdrew
its previous application with FCC to de facto control SIRIUS XM.
Instead, the company is now willing to get a full control. Liberty
Media at present has 49.5% stake in SIRIUS XM's total outstanding
shares. With nearly 23 million subscribers in its kitty, SIRIUS XM,
the largest satellite radio service provider, is expected to
generate huge financial synergies to Liberty Media over the long
In November 2011, the company invested in Barnes & Noble.
Management is pursuing a systematic share buy-back program to boost
its shareholders' wealth. Meanwhile, the stock price has soared
more than 77% in the last year and is currently trading at
significant high multiples compared with S&P 500 and its peers
with respect to several valuation metrics. We believe Liberty Media
is currently fairly valued and maintain our Neutral recommendation.
BARNES & NOBLE (BKS): Free Stock Analysis
LIBERTY MDA-LC (LMCA): Free Stock Analysis
LIVE NATION ENT (LYV): Free Stock Analysis
SIRIUS XM RADIO (SIRI): Free Stock Analysis
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