Sirius XM, Nokia & RIM: 'Staying Alive' or 'Walking Dead?'
However, I am a fan of beaten down stocks that make excellent turnaround stories -- particularly those on Wall Street where the odds have been stacked so heavily against them that any improvement makes it look like they are doing great, when in fact they are merely just "staying alive."
Companies such as Nokia(NOK) , Research in Motion(RIMM) and Sirius XM(SIRI) have fallen from so far that each earnings report is considered a "victory" if it comes in "less bad" than Wall Street expected. Like many other names including Sprint(S) and perhaps even Netflix(NFLX) these once proud market leaders are now on life support until they get their big break.
However, I'm now realizing that for them, a turnaround is just no longer possible -- as where it once required only a change of fortune, it now requires a changing market. So as they continue to sing the tune of "staying alive," I think a more applicable theme just might be "the walking dead."
The main consistency you will find with at least four of these five companies is excuses -- particularly about the economy's effect on their businesses. Nokia is the exception; I have rarely heard excuses from that camp.
All of these names are now on life support for their repeated failures to adapt to a changing market. One can argue it is somewhat premature to place Sirius in this category. Despite a remarkable turnaround story since the brink of bankruptcy in 2009, Sirius has never demonstrated to the market that it can be anything other than the "little engine that thinks it can."
To Sirius' credit, it has done a great job at selling its recovery to investors -- many of which have become investors for a myriad of reasons, not least because the stock trades at what many would consider cheap. While these investors are busy counting the number of shares they have, they are ignoring that Apple(AAPL) with an assist from the IP platform is about to takeover the automobile -- Sirius' bread and butter.