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Sirius has got talent ... and decent earnings

August 7, 2012: 12:36 PM ET

I'm still sorta stunned that shock jock Howard Stern has deigned NBC's sappy "America's Got Talent" contest to be worthy of his time. But with shares of Stern's key employer Sirius XM Radio (SIRI) doing as well as they have lately, maybe the self-professed King of All Media has mellowed out a bit.

Sirius reported decent earnings and sales growth for the second quarter Tuesday. That lifted shares by more than 5% in mid-afternoon trading. And the stock is up more than 20% year-to-date. Investors were happy to hear that the company also boosted its subscriber targets for the full year.

Now there's a couple of reasons why the satellite radio company's stock has been a big hit this year. Most notably, the rebound in auto sales in the U.S. has to be helping. GM (GM), Ford (F), Toyota (TM) and other major car companies have agreements with Sirius to pre-install Sirius XM radios in their vehicles.

But the other factor lifting the stock is the hope that Sirius may soon get taken over by investor John Malone's Liberty Media (LMCA). Malone took a stake in Sirius when the company was in dire straits during the worst of the recession in early 2009 and is now trying to take full control of Sirius. The Federal Communications Commission will ultimately decide if Liberty can take over the firm outright.

However, it's not yet clear if the highly respected current CEO Mel Karmazin will remain with the company after his contract is up at the end of the year -- regardless of what happens with Liberty.  So that could be a risk. What's more, Sirius still faces some tough competitive challenges from the likes of Apple (AAPL) via its iTunes platform and the devices the run on it as well as online radio firms Pandora (P) and Spotify. But for now at least, it does not look like there's much static on the radio for Sirius in the short-term. Check today's Buzz video below for more.

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Paul Lamonica
Paul R. La Monica
Assistant Managing Editor, CNNMoney

Paul R. La Monica is an assistant managing editor at CNNMoney. He is the author of the site's daily column, The Buzz, and also tweets throughout the day about the markets and economy @LaMonicaBuzz. La Monica also oversees the site's economic, markets and technology coverage.

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