Cramer is serious on Sirius Satellite Radio

On CNBC's MAD MONEY, Jim Cramer hosted Sirius Satellite Radio Inc. (NASDAQ:SIRI)'s CEO Mel Karmazin. As a reminder, Cramer was positive once already this afternoon on his STOP TRADING segment on CNBC. Despite rumors of a deal between Sirius and XMSR Satellite Radio Holdings (NASDAQ:XMSR), Mel said he doesn't need to merge ... but, the company would do what is best for shareholders.

Cramer earlier said the stock could go to $5.00 or higher on its own and could go to $8.00 in a merger situation, and touted the company's third quarter as good. In his opinion, the company will make money in two years. If he had to describe the stock in a phrase, it would be "growth at a reasonable price."

While talking to Karmazin, Cramer noted that having Howard Stern has worked, as they have added over four million subscribers during Stern's tenure with the company. Cramer asked if NASCAR could be as big as Stern, in terms of growth, for Sirius next year. Karmazin said he thinks many will buy the service solely for NASCAR, so yes. With regards to the soft retail market, Karmazin said it certainly has quieted down, but he thinks the holiday season will be gangbusters like last year. Karmazin did admit that his company hasa lot to do to hit its year-end numbers, but still believes Sirius will hit cash flow positive next year on $1 billion in revenues, if it hits targets.

Compared to terrestrial revenues, SIRI is behind only Clear Channel Communications, Inc. (NYSE:CCU) and CBS Corporation (NYSE:CBS) in listeners and will be the third largest or fourth largest radio entity next year after only having four years of operations. He said they will do $3 billion in revenues by 2010. He wants ad revenue about 10% of total revenues, or $100 million next year. Karmazin said there could be a value created in a merger, but they would rather go it alone as they are still adding more partners. He would be open to making an acquisition if it helped shareholders.

Cramer said he thinks that the stock can make a 50% move from here.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.