Can Sirius XM Get the Traffic Needed to Make the NASDAQ?

March 5th, 2010 by admin

After nearing bankruptcy a little over a year ago, Sirius XM has weathered a huge recession and felt its way through a turn-around of its business model. The new Subscriber traffic has been increasing rapidly. Answering every critic and turning business loss into profit, Sirius XM has managed to give something back to investors this last year after a long time of having taken it away. However, its last test to date was to avoid a reverse split due to compliance with the NASDAQ regulations.

You see, Sirius XM has been a cheap penny stock for quite some time, and in order to stay listed on the NASDAQ they must trade over $1 for 10 consecutive days. However, after reaching 8 consecutive days, it traded under $1 for two days in a row now and with only 9 days left until the deadline. It appears the penny stock isn’t going to be able to avoid the dreaded reverse split. However, this means that Sirius XM will not be a penny stock for much longer, and this might even bring in more institutional investing at a time when the business truly does look like it’s on an upswing.

Either way, Sirius has somehow failed this one test that meant so much. However, it appears that the grass might indeed be greener on the other side. Sirius XM’s business model has improved, they will no longer be a penny stock, and indeed institutional investors are ready to jump in once the price is $5.00 a share. Perhaps the reverse split should be what they have been shooting for all along.

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