Is Sirius XM a classic value trap?

Although the P/E ratio is Wall Street’s most common measure of whether a stock is cheap or expensive right now, it is not always the best. In this video, Motley Fool consumer analyst Blake Bos examines SiriusXM and explains to investors why the normalized P/E is much higher than it looks. And with that high multiple, Sirius is valued as a growth company, but as its moat shrinks while Internet radio becomes more competitive in automotive ecosystems, it may no longer be the growth story it once was.

Although Sirius XM has been one of the market’s biggest winners since hitting its lowest point three years ago, there’s still healthy upside potential if things go well – and plenty of room for losses if they don’t. Read all about Sirius in our brand new premium report. Just click here now to get started.

The article “Is Sirius XM a Classic Value Trap?” originally appeared on Fool.com.

Blake Bos and The Motley Fool do not own any stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don’t all agree, but we all believe that considering a broad range of insights makes us better investors. The Motley Fool has a disclosure policy.

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