While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking analyst upgrades and downgrades -- just in case their reasoning behind the call makes sense.
What: Shares of Aflac (NYSE: AFL ) climbed 1.5% this morning after FBR Capital upgraded the life insurer from market perform to outperform.
So what: Along with the upgrade, analyst Randy Binner raised his price target on the stock to $71 per share (from $60), representing about 15% of upside to Monday's close. The stock has underperformed its industry in 2013, but Binner thinks Aflac's improving fundamentals should help close the gap.
Now what: FBR expects Aflac's top line to improve in relatively short order. "We are upgrading AFL to Outperform from Market Perform based on our view that sales data following the Japan Post deal, and better news on solvency margin ratio (SMR) management and yen repatriation, should help shares close their ~30% underperformance to the group year to date," said Binner. With Aflac shares trading at such a wide P/E discount to the industry -- 8.6 versus 12.5 -- it's tough to argue with FBR's outperform call.
More dynamic dividend picks
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.