Could Buying Sirius XM Stock Today Set You Up for Life?
Key Points
Sirius XM’s rising free cash flow is probably the most encouraging financial trend.
The market still isn’t pleased, given revenue and subscriber declines.
Investors in search of a bargain, as well as those that like a hefty income stream, might be interested in buying this music stock.
- 10 stocks we like better than Sirius XM ›
As investors with a long time horizon, we all want to find those rare investment opportunities that can really move the needle. Adding a potential 50-bagger or 100-bagger to your portfolio can generate life-changing wealth. Of course, the market isn't offering these every day. And for many, they might never come around.
Sirius XM (NASDAQ: SIRI), which has gotten crushed in the past five years, was once a booming investment. Could buying this music stock today set you up for life?
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: Getty Images.
Free-cash-flow growth is overshadowed
In 2027, Sirius XM's management team hopes the business will generate free cash flow (FCF) of $1.5 billion. That would be 19% higher than the $1.26 billion produced last year. This is the most important aspect of the company's fundamental story. Sirius XM's satellite capital expenditures are declining, which is supporting its FCF trajectory.
That positive trend hasn't propelled the stock, however. Shares declined 12% in 2025, so the market is focused on the negative attributes plaguing the business.
Sirius XM is a no-growth company. Its revenue last year of $8.6 billion was below 2024's total. And it lost a net 301,000 self-pay subscribers during the 12-month period. Both of these key performance metrics have been heading in the wrong direction.
No industry is insulated from technological progress. Consumers have benefited in the past decade from more capable and feature-rich smartphones, particularly from Apple and Samsung. Internet connectivity also continues to improve drastically. In other words, people aren't dependent on satellite radio to get their entertainment while in a car. Streaming platforms provide a compelling customer value proposition.
In the years ahead, this will remain a headwind for Sirius XM. It has to outcompete deep-pocketed rivals. That won't be an easy task. And the latest financial figures don't give investors reasons to be optimistic.
Calling all value and dividend investors
Given the lack of growth, Sirius XM isn't a stock you'd buy if your main goal is to achieve life-changing returns. This business just isn't going to do that.
Value investors might still be interested, though. The stock trades at a forward price-to-earnings ratio of 7.4. If your strategy revolves around purchasing cheap stocks, buying Sirius XM makes sense. But just remember that multiple expansion is not a certain outcome, especially when the company in question hasn't been able to increase its revenue.
Dividend investors could also recognize Sirius XM as a worthy candidate. Its current dividend yield of 5% can draw market participants that are after a passive income stream.
Should you buy stock in Sirius XM right now?
Before you buy stock in Sirius XM, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Sirius XM wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $519,015!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,086,211!*
Now, it’s worth noting Stock Advisor’s total average return is 941% — a market-crushing outperformance compared to 194% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of March 2, 2026.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.
Recommended Articles
