June SAAR and Goldman Sachc positive survey about Sirius XM Radio Inc., (NASDAQ:SIRI)

Denver, CO, 07/09/2013 (Avauncer.com) – Shares of Sirius XM Radio Inc. (NASDAQ:SIRI) jumped up by as much as 2.96%, to close at $3.48 in its last trading session. Shares remained at the higher end of its 52-week range of $1.99 to $3.62. This was in the backdrop of the release of the June SAAR (seasonally adjusted annual rate) and a Goldman Sachs consumer survey, which hinted at the strong growth Sirius has to promise in its near future.

The current June light vehicle SAAR of 16 million exceeded the forecasts of both GS (15.7 million) and Street forecast. This should be seen positively, as volume grows at Sirius XM. Also, remarkably, it is the first time since 2008 that auto sales have touched the 16 million run rate at Sirius.

Also, the market survey conducted by a team of analysts surveying 2,000 US consumers found that respondents have reported robust levels of positive attitude, with a spending spree expecting to touch a now high in second quarter of 2013. The increase in disposable income of its consumers came at the back of increased job creation and also the effect of wealth creation from rising home and equity prices. Also, the rise in spending capacity of people in general should be seen as positive news for Sirius as most of them were interviewed with their enthusiasm for spending on autos.

This has been supplemented by Sirius’ partnership with automaker giant Ford Motor Co., (NYSE:F) to create the Sync AppLink. Such app allows its listeners to access Sirius radio for the first time through Apple and Android handsets. The app has teamed up with Ford by allowing the buyers to switch listening to different programs using built in controls or voice commands.

However, with this news, investors have not been as confident with Sirius as it has been with its growth prospective. It should be noted that the app service of Sirius could be disrupted y the free service of the tie up between Google and Pandora. Tuneln is another free service catering to the same target market. Investors’ main contention with the free apps is that it may steal away paid subscribers of Sirius, hurting its target market.