Have $500? 2 Absurdly Cheap Stocks Long-Term Investors Should Buy Right Now

ltcinsuranceshopper By ltcinsuranceshopper March 16, 2025


With the recent market sell-off, a number of stocks have just been tossed right into the bargain bin. This includes some very well-known names that are trading at very low valuations.

Let’s look at two absurdly cheap stocks to buy right now.

For those unfamiliar with Sirius XM (NASDAQ: SIRI), it operates a satellite radio service. It also owns the Pandora streaming music app and a podcast network. The company became fully independent last year following a complicated spinoff/reverse stock-split transaction with Liberty Live Group.

While not a growth stock, the one thing the stock is today is cheap.

It currently trades at a forward price-to-earnings (P/E) ratio of less than 7.5 times based on 2025 analyst estimates and an enterprise value (EV)-to-EBITDA (earnings before interest, taxes, depreciation, and amortization) ratio of below 7 times. The latter metric takes into consideration its net debt as well as takes out the non-cash depreciation from its capital expenditures (capex) used to launch satellites that is reflected in that debt. EV/EBITDA gives a better picture of Sirius XM’s current operations, although the stock is still cheap by either valuation metric.

SIRI PE Ratio (Forward) Chart
SIRI PE Ratio (Forward) data by YCharts

While Sirius XM isn’t suddenly going to be confused for a growth stock, it does have a number of avenues to bolster its stock price. One of the biggest opportunities for the company is deleveraging and reducing its debt. At year-end, the satellite radio operator carried about $10.3 billion in debt on its balance sheet.

While the company isn’t growing its revenue, one thing it does do is generate a lot of free cash flow. In 2024, it produced free cash flow of $1 billion, and it projected $1.15 billion in free cash flow this year. Those numbers, meanwhile, should continue to rise over the next few years as its satellite-related capex will continue to decline. It will go from around $220 million this year to only $95 million in 2026 and to nearly $0 by 2028.

Below is Sirius’s XM’s satellite-related capex spending plan.

2024

2025

2026

2027

2028

Satellite capex

$220 million

$95 million

$45 million

$0 million

Data source: Sirius XM presentation.

This should allow the company to meaningfully reduce its debt over the next five years, which should help boost its stock price.

Meanwhile, after reducing costs by $350 million in 2023 and 2024, the company is looking for an additional $200 million in cost savings this year. This is coming from optimizing market spend and reducing operating expenses.

In addition, the company is reworking how it prices and markets its subscriptions this year. It will shorten the length of introductory offers for automotive trials while offering new lower-priced package options that start at about $10 a month. It will also offer additional add-ons for things such as talk and sports radio. It expects this to have an impact on its first-half results but then lead to better results going forward through higher customer satisfaction.



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