Standard & Poor's is placing Sirius XM Radio's (Nasdaq: SIRI) credit ratings on CreditWatch -- and that's a good thing.

The credit rating agency indicates that it may upgrade the company's debt rating, which would both validate the satellite radio provider's turnaround, and make it cheaper to borrow money in the future.

Surely you've seen this coming. Sirius XM's balance sheet isn't necessarily any better now than it was a year ago. It's still carrying roughly $3 billion in long-term debt. The real improvements at Sirius XM have come in the income and cash flow statements.

Sirius XM has now been profitable over the past four quarters. This alone is huge, since EBITDA gets plumper once the "E" earnings component actually turns positive. The satellite radio giant has also gained net subscribers during the past four quarters, getting back on the growth horse after it fell off during the first half of last year.

A credit upgrade doesn't mean that Sirius XM can issue corporate debt at an interest rate of 1% or lower, the way that IBM (NYSE: IBM) and Microsoft (Nasdaq: MSFT) did on three-year notes last month. However, it will give Sirius XM the ability to refinance at more attractive rates down the line. In other words, the "I" interest component is likely to refreshingly shrink.

There's not a lot that Sirius XM can do about the "D" and "A" part of EBITDA -- and it won't have much of a "T" tax burden, given the billions in tax-loss carryforwards in its back pocket.

In other words, Sirius XM's EBITDA snapshot is impressing Standard & Poor's. The healthy numbers should also help bottom-line profitability, if Sirius XM decides to refinance its debt before that obligation matures in a couple of years.

In another boost, XM isn't canning the Opie & Anthony show after all. I tuned in this morning to find callers congratulating Anthony Cumia for inking a new two-year deal. According to Orbitcast, the two anchors of XM's Virus 202 channel didn't sign until last night and early this morning. That's cutting it pretty close for a contract that expired yesterday. One can only hope that over on Sirius, Howard Stern won't put his fans through a similar wringer.

O&A reportedly signed for terms similar to their original contract, perhaps signaling Sirius XM's approach with Stern and other celebrity deals, including Oprah Winfrey and Martha Stewart Living Omnimedia's (NYSE: MSO) namesake star, when their deals come up.

Cost-containment on the content side, even as subscriber count and revenue generated per subscriber are on the rise? That sounds like the recipe for yet another credit-rating upgrade down the line.

Do you believe that Sirius XM's credit rating will continue to improve? Shares your thoughts in the comment box below.

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Longtime Fool contributor Rick Munarriz is a subscriber to both Sirius and XM. He does not own shares in any of the stocks in this article. He is also a member of the Rule Breakers analytical team, seeking out the next great growth stock early in its defiance. The Fool has a disclosure policy.