Barrington Reiterates Outperform Rating, $3.75 PT on Sirius XM Radio on Ownership Shift

In a report published Monday, Barrington reiterated its Outperform rating and $3.75 price target on Sirius XM Radio

. Barrington noted, “Subscriber gains remained strong in the fourth quarter and full-year 2012 as Liberty formerly asserted its controlling interest. Churn and conversion rates remain in line with recent historical experience despite implementation of a first-ever price increase as a merged company at the start of 2012. Further, the only changes of substance to this point with the change in control appears to be a more concerted intent to return capital to shareholders in the form of a $0.05 per share special dividend in December and initiation of a $2 billion stock buyback program to be implemented starting in 2013. Liberty is intent on recapturing funds expended to establish its controlling stake. Aside from that, Liberty management has publicly expressed support for the fundamental progress established by Sirius XM management, suggesting that any further shift in ownership (such as the long-speculated Reverse Morris Trust option) would not necessarily or even likely be a 2013 or 2014 event.” Sirius XM Radio closed on Friday at $3.12.