Activity surrounding the stock of Sirius Satellite Radio was in hyperdrive Wednesday after the company revealed that its star talent, the very well-paid Howard Stern, can sell his considerable equity in the company any time he chooses to.

Never a laggard to begin with, Sirius trading volume reached a whopping 130.8 million shares, making it the most active issue Wednesday on the Nasdaq exchange, where shares dropped 5.9% to $6.12. In trading Thursday, Sirius shares closed 8 cents or 1.31% higher at $6.20. By contrast, Time Warner, the world's biggest media conglomerate, traded a mere 18.6 million shares Wednesday.

The slide in the stock price wiped out nearly $12 million in wealth from Stern and almost $1.2 million from Don Buchwald, the shock jock's manager. Stern was awarded 31.25 million shares of Sirius on Monday, the day his show debuted on the No. 2 satellite radio concern, while Buchwald was given 3.125 million shares. The pair were to be awarded the shares in 2010, though Sirius accelerated the date to Monday based on the positive impact Stern has had on subscriber growth.

Some analysts noted Wednesday, though, that the possibility Stern or Buchwald might dump their shares should not signal that they've lost faith in the company's prospects. They might sell simply to pay their tax bill.

Merrill Lynch analyst Laraine Mancini said that Stern's tax liability is likely $80 million-$90 million, while Buchwald's is $8 million-$9 million, and she reiterated her bullish expectation for Sirius stock, guessing it will go to $9 over the next 12 months.

"Confusion over Howard Stern share registration creates buying opportunity," the analyst wrote in a research note. She also stressed that the regulatory filing made by Sirius on Wednesday doesn't necessarily signal an intent by either Stern or Buchwald to immediately sell all or even a portion of their shares, it simply affords them the opportunity to sell.

Likewise, Oppenheimer analyst Thomas Eagan reiterated his "buy" recommendation on Sirius and his $8 price target.

When Sirius signed Stern in October 2004, it agreed to pay him $80 million per year in cash in addition to the stock. At the time, the stock's value was just north of $115 million, whereas at the close of trading Wednesday it was worth more than $210 million.

Sirius shares spiked on the news 15 months ago that Stern would eventually join the company and spiked again when radio titan Mel Karmazin joined as CEO. About 13 months ago the shares that would eventually be awarded to Stern and his manager were worth about $310 million, which would have valued Stern's five-year commitment to Sirius at $710 million in stock and cash, substantially more than the $500 million figure bandied about for the past 15 months.

Some investors who were learning that Stern might be profiting more than was originally reported are under the mistaken impression that the extra money is coming from the coffers of Sirius, rather than it simply being the function of a rising stock price, Eagan said.

"We believe this could put a drag on Sirius today, creating a buying opportunity for the stock," he wrote in a research note Wednesday.

It is also possible that Stern could receive more shares if further subscriber and advertising targets are met. Karmazin said this week he has ramped up the sales force responsible for generating ad revenue from the two channels that Stern is programming. The company intends on selling about 6 minutes of advertising per hour against Stern's show.

Separately on Wednesday, Sirius said that it inked an exclusive deal with Rolls-Royce Motor Cars for the inclusion of a Sirius radio as standard equipment in cars sold in the U.S., complete with a lifetime subscription to the service.