Sirius XM Holdings (SIRI) is a cult stock to say the least. Either people love Sirius stock — the corporate home of Howard Stern — or they hate it. There is very little middle ground for SIRI.

But for those who have stuck by SIRI stock — even at it flirted with bankruptcy — the rewards have been huge. Shares of Sirius stock have surged by an eye-popping 2,530% over the past five years. That gain has been thanks in large part to the tenacity of former CEO Mel Karmazin, along with a well-timed financial rescue by cable tycoon John Malone.

Still, Sirius stock — which is often among the Nasdaq’s most actively traded — remains as controversial as ever. Though most analysts consider shares of SIRI stock to be a buy, it sports quite the premium. Sirius stock trades at multiple of nearly 51 times trailing earnings — expensive vs. bigger and more profitable media companies such as Twenty-First Century Fox (FOXA, P/E of 13) Viacom (VIAB, P/E of 17) Walt Disney (DIS, P/E of 21).

Is the satellite radio provider worth such a lofty premium? Let’s look at the pros and cons of buying Sirius stock.

Pros of Sirius Stock

Finances. The first piece of good news for Sirius stock investors is that SIRI is in much better financial shape than it used to be. SIRI slashed its average debt costs from 9.2% to 5.2% over the past 15 months. During the third quarter, it also repurchased about $459 million worth of Sirius stock and is buying back $500 million worth of SIRI shares from John Malone’s Liberty Media (LMCA, LMCB). Liberty controls the satellite radio provider thanks to the $530 million financial lifeline it gave SIRI back in 2009.

Popularity. Another promising sign for Sirius stock investors is the fact that people do value satellite radio. SIRI added 513,000 subscribers in the latest quarter — far better than cable television and satellite TV providers. Comcast (CMCSA) lost 117,000 video customers in its latest quarter, while Dish Network (DISH) only gained 134,00 new customers. Plus, the car market is helping to boost the popularity of Sirius Radio, and thus boost Sirius stock. Sirius Radio comes installed on a whopping 70% of new cars. Plus, SIRI is making inroads inroads in the used car market as well, which is about three times the size of the market for new cars. That could be a boon to Sirius stock over time.

Telematics. Sirius stock investors likely see the company’s potential beyond its core market as well. See, as the market for satellite radio becomes mature, SIRI is branching out into related businesses such as telematics. This is a fancy word that describes a wide range of in-vehicle services such as driver maintenance alerts and location-based directions. In fact, SIRI recently acquired telematatics provider Agero for $530 million to gain a foothold in this $4.2 billion market. Expect more deals to follow — and Sirius stock to keep climbing if they pay off.

Cons of Sirius Stock

Competition. This is a problem as old as Sirius itself — and one that likely keeps Sirius stock investors up at night. SIRI competitors range from Pandora (P) to Spotify to Apple’s (AAPL) new Internet radio service. Sirius has to spend big bucks on original content to stay ahead of its rivals, and those costs are going to continue to rise for the foreseeable future. That could put a damper on Sirius stock. Meanwhile, while SIRI subscriber growth is solid, it continues to slow.

John Malone. The cable tycoon controls SIRI stock through his Liberty Media company. Sure, Sirius recently acquired $500 million worth of its stock from Liberty, as we mentioned. But even with this deal, Liberty still owns a whopping 52% of Sirius. It seems likely that more Sirius stock sales are in the works, which may keep the share price of SIRI stock depressed as investors fret about potential dilution.

Howard  Stern. The shock jock is a huge wild card for Sirius, and SIRI stock. Earlier this year, the self-proclaimed “King Of All Media” said he would leave Sirius after his contract expires in 2015. Though Sirius has vowed to retain Stern beyond that date, Stern — who has expanded his fan base thanks to his work on “America’s Got Talent” — may have other ideas. This is especially true since he lost a $300 million lawsuit against SIRI,  in which he accused the company of cheating him out of bonuses. If Stern bolts, Sirius stock investors could get the jitters.

Verdict on Sirius Stock

All in all, Sirius stock has proven naysayers — including me — wrong. I’m not the only one who has predicted the company’s doom for years. But investors should still approach SIRI stock with caution, as it is really expensive and likely to remain volatile for a while.

As a result, Sirius stock is far too risky for more most investors. If you own shares of SIRI, there’s no reason to sell. But anyone tempted to buy Sirius stock should wait for a pullback. And when they do buy shares of SIRI, they might also want to order antacid tablets and/or antidepressants in bulk.

Because even under the most optimistic of scenarios, Sirius stock will continue to be a rollercoaster.

As of this writing, Jonathan Berr did not hold a position in the aforementioned stocks.