Sirius XM Holdings Inc. (NASDAQ:SIRI) has had a pretty good year in terms of stock price. SIRI stock has improved by more than year-to-date and roughly 36% since its February low. Shares even hit a 10-year high in November.

With the 2016 remaining just a few weeks, it’s almost certain that SIRI stock will record a positive year altogether, barring any late market fiasco, of course.

The question now is if Sirius XM Radio shares can enjoy another (or an even more) stellar year in 2017.

I think the answer is a resounding “yes.”

The State of SIRI Stock

Sirius XM literally owns the satellite radio market. As of the end of the third quarter, SIRI had more than 31 million subscribers compared to just under 29 million a year ago. Impressively, the company has reported 28 consecutive profitable quarters as of the third quarter. Sirius XM also has been pretty consistent in growing revenues over the past decade.

However, the investment community isn’t particularly upbeat about the future of SIRI stock. The worry? That satellite radio is a transitory technology at risk of becoming obsolete. The smartphone revolution as well as the growing popularity of connected cars instills the belief that internet radio — not satellite radio — is the future.

Merger With Pandora

CNBC reported that internet radio giant Pandora Media Inc (NYSE:P) is open to an acquisition by Sirius XM. This is something of a reversal, as Pandora reportedly rejected a $15-per-share offer from SIRI earlier in the year.

If the two do pair up, it’s likely to be announced in 2017. Such a merger will effectively reduce fears that Sirius XM is going away sometime soon, as it will address the oncoming force of Internet radio by … well, joining it.

As RBC analyst Mark Mahaney said, this would allow Sirius XM to diversify its revenue streams as well as customer base. Sirius currently depends on subscription for its revenue; Pandora’s sales come primarily on ad dollars.

Moreover, having access to Pandora’s customers would give SIRI stock an avenue for upsells. Not to mention, a Sirius XM-Pandora merger would likely increase the combined appeal of the joined companies to advertisers.

The potential for revenue growth in this prospective deal is wide and considerable.

Don’t Count Out a Sirius XM Video App, Either

When Howard Stern signed a new contract with Sirius XM last year, the company also announced a possible video-as-a-platform initiative. While SIRI execs haven’t been forthcoming regarding the details of the video service, Stern was upbeat.

Sirius’ James Meyer said during the third quarter earnings call that the company had signed an agreement with Whalerock to plot a path for how SIRI can use video to improve its services over the long-term. He hinted that the video service would launch next year.

It’s unclear whether Sirius is planning to monetize the video content based on its traditional subscription model. We’ll have to wait until the service launches. If SIRI takes the route of making its video content available on subscription, it’s difficult to see how it’ll yield any significant growth for the company. The internet is littered with tons of free video services already. Not many folks will be willing to pay for it, except the service somehow comes bundled with the usual sat-rad subscription.

The smarter route to take would be using the video content to simply grow Sirius XM’s popularity, thereby, allowing for improved organic growth of its radio business. Again, we’ll have to wait to see the path the company takes.

So SIRI stock holders should keep an eye out for developments on this front, too.

Bottom Line on Sirius XM

If Sirius XM can pull off either of the above catalysts, expect 2017 to be another stellar year for SIRI stock.

Also, I think the fear regarding the future of Sirius’ satellite radio business is blown out of proportion. The company keeps growing its subscriber base too fast for a company that’s at risk of obsolescence.

A freshly minted dividend also should give shareholders more confidence in the company’s financial standing.

As of this writing, Craig Adeyanju did not hold a position in any of the aforementioned securities.