Where Will SiriusXM Stock Be in 5 Years?

SiriusXM Holdings (NASDAQ: SIRI) may be one of the more difficult stocks for investors to understand. The company holds a monopoly on satellite radio in the U.S., but since consumers can stream audio over their smartphones, the company still contends with significant competition. That may partially explain why the stock is down by two-thirds over the last five years.

Nonetheless, it maintains a loyal customer base, has popular personalities under contract, and Warren Buffett's company, Berkshire Hathaway holds a massive stake in SiriusXM stock. The question for investors is: Are those factors are enough to inspire a comeback over the next five years? Let's take a closer look.

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The state of SiriusXM

SiriusXM is the U.S.'s only satellite radio provider. The platform boasts around 33 million subscribers, providing ad-free news, sports, podcasts, and other audio content to its listeners.

Additionally, the company has some stars in its platform. Howard Stern has long been under contract with the company, though that's about to end. Today, stars like Andy Cohen and Jeff Lewis are exclusive to the platform. Also, radio shows such as Crime Junkie Radio or Road Dog Trucking continue to be a draw for the platform.

However, for non-exclusive content, listeners can turn to audio content streamed over alternative platforms, making this control of satellite radio less meaningful. Also, one has to go back several years to find the last time SiriusXM drew double-digit revenue growth, and in the latest quarter, its subscriber base shrank by about 40,000 in the third quarter of 2025.

Moreover, one key way it earns subscribers is the platform's inclusion in new car purchases. With new car sales on track to be down for the year, this does not bode well for the satellite radio provider.

Such challenges may partially explain the five-year performance of the stock. It was also likely a factor in the 1-for-10 reverse stock split that occurred in September 2024 when it merged with Liberty Media Corporation.

Still, even though part of the rationale for the reverse split was to have a more attractive stock price, the stock has dropped by almost 20% since that time.

SiriusXM's attributes

However, for all of its challenges, Warren Buffett's team has long been bullish on the stock. It began acquiring shares in the fourth quarter of 2016. While it has sold and rebought shares over the years, it now holds just under 125 million shares, or 37% of the total outstanding shares.

One reason may be the stock's dividend. SiriusXM has offered a payout since it began paying quarterly dividends in 2016. It has also increased this payout annually on a split-adjusted basis. At $1.08 per share annually, its dividend yield is now at 5%. This is far above the 1.1% dividend returns on the S&P 500.

Also, SiriusXM can likely afford this payout. Despite its troubles, it generated more than $1.2 billion in free cash flow over the trailing 12 months. Over the same period, the dividend cost it $366 million. This leaves it with enough free cash flow to maintain and raise the dividend while repurchasing shares and investing back into the business.

The company has also reduced its share count by about 0.8% since the September 2024 merger. Additionally, the stock trades at a P/E ratio of 8, and when factoring that in with the dividend and reduced share count, SiriusXM could appeal to some investors.

SiriusXM in five years

Over the next five years, SiriusXM is unlikely to fall as far as it did over the last five-year period, but it will probably struggle to beat the market.

Admittedly, it offers an attractive investment case for income investors. Between the 5% dividend yield, share repurchases, and rock-bottom valuation, the stock is more likely to rise than fall during that time, and Berkshire's backing could also help attract more interest in the stock.

Unfortunately, audio streaming from other devices renders its satellite radio monopoly meaningless in most respects. Moreover, the company continues to contend with a falling subscriber count and no obvious catalyst to return to subscriber growth.

Those factors reduce the odds that SiriusXM stock will generate market-beating returns over time. Unless and until it can attract more subscribers, SiriusXM is unlikely to deliver satisfactory returns unless one invests for income.

Will Healy has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.