8 Best Warren Buffett Stocks to Buy According to Analysts

2. Sirius XM Holdings Inc. (NASDAQ:SIRI)

Warren Buffett’s Q2 2024 Stake: $376.05 Million

Analyst Upside Potential, as of September 26: 37.40%

Number of Hedge Fund Holders: 33

Sirius XM Holdings Inc. (NASDAQ:SIRI) is a communications services investment play that operates as an audio entertainment company. It provides music, sports, entertainment, comedy, talk, news, traffic and weather channels, and other content.

The leading satellite radio provider carried out a one-for-10 share stock split while it was in no danger of being delisted from the NASDAQ. The stock split was one of the catalysts behind the share price’s more than doubled value, and it was seen as one of the plays geared toward attracting institutional investors. The stock split caused the company to reduce its share count from a high of 3 billion to around 339 million.

In addition to the reverse stock split, Sirius XM Holdings Inc. (NASDAQ:SIRI) stock also rose when the company merged with Liberty Sirius XM Group (Liberty Media’s Sirius XM tracking stock).  The merger allows Sirius XM to simplify its capital structure and strategy for continued success.

In the second quarter of 2024, Sirius XM Holdings Inc. (NASDAQ:SIRI)’s revenue dropped by 3% compared to the previous year, reaching $2.2 billion. The company’s net income was $316 million, leading to diluted earnings per share of $0.08, which increased from $310 million in the same quarter of the previous year.

Within its core business, Sirius XM Holdings Inc. (NASDAQ:SIRI) had 33 million subscribers who paid directly, but this number saw a decrease of 100,000 during the same timeframe, with a self-pay subscriber churn rate of 1.5%. The revenue from this segment, which was $1.6 billion, experienced a 5% decline year-over-year, attributed to a smaller average number of self-pay subscribers and a $0.42 increase in the average revenue per user in the second quarter.

Even as Sirius XM Holdings Inc. (NASDAQ:SIRI) remains under pressure, it returns value to shareholders. The company has confirmed a $1.2 billion buyback program. It has also affirmed its commitment to the dividend plan with a yield of 4.3%. The buyback and dividend program could help offer support to the stock.

Analysts on Wall Street believe SiriusXM is a strong buy with an average price target of $33.14, implying 32.83% upside potential. Additionally, the stock trades at a discount with a price-to-earnings multiple of 6.60.

In the second quarter of 2024, Sirius XM Holdings Inc. (NASDAQ:SIRI) experienced a notable surge in interest from leading money managers. Insider Monkey’s database shows that hedge fund positions in the company increased from 17 to 33, with these investments collectively valued at around $530 million.