Deutsche Bank upgraded Sirius XM Holdings to Buy from Hold and raised its price target to $45 from $31, implying roughly 63% upside from the share price at the time of the call. The bank argues that Wall Street is underestimating SiriusXM's potential as its business shifts toward digital audio advertising, with the biggest part of the bull case being SiriusXM's planned role as YouTube's exclusive U.S. audio advertising representative. Deutsche Bank estimates the relationship could eventually generate around $2 billion in annual incremental revenue by 2029, with a high-teens EBITDA margin and roughly $350 million-$400 million of additional EBITDA. The company also expanded its partnership with Amazon, potentially creating another avenue for growth in digital audio. The main uncertainty is Berkshire Hathaway's growing ownership stake, which already stands at about 37% of SiriusXM's outstanding shares, raising questions about how SiriusXM will balance buybacks, dividends, and Berkshire's ownership position.
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Deutsche Bank Aktiengesellschaft
Sirius XM Holding Inc