As expected by readers of kingofalltrades.com, and as our own Rick King forecasted after Sirius XM Radio’s latest quarterly report, the upgrades and positive news just keeps coming.  S & P has now raised Sirius XM’s credit outlook from Stable to Positive.  They maintain a hold on their B- Corporate rating, keeping them still on the verge of being removed from speculation grade, and entering the world of investment grade status.  Since their outlook is now positive, this means you can expect a credit upgrade from S & P within 3 months to one years time.

This came after Sirius XM reported break even earnings for the first time in its history.  Costs were controlled yet again, and revenue was up.  Refinancing existing loans in 2009 with better rates, due much later, and even used cash to remove debt.  They also had 60 million shares lent for shorting bonds returned to them, and they were destroyed. This has raised the attention of the number one equity and bond rating service in the world.  S & P’s own Tuna Amobi has reiterated his Hold opinion on Sirius XM, and his $1 price target on a stock currently trading well off that mark.

THOMSON REUTERS™ has raised Sirius XM’s guidance for the year, adjusted from a .09 cent loss for the year, to .08 cent loss for the year.  Having lost .10 cents already, this indicates a .02 cent earnings profit will be reported by Sirius XM in Q4.  This would make this historic quarter by Sirius XM dwarf in comparison if Sirius XM is able to execute on this guidance (Sirius XM’s guidance on EBITDA for the year so far is looking accurate).

Guidance for 2010 has also been raised from .03 cent loss, to only .01 cent loss.  As you can see by how they are performing lately, and knowing most of the losses for Sirius XM came from charges and accounting issues and stock dilution in 2009, I think a .01 cent loss is way too conservative.

Disclosure: Long SIRI