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 H&R Block (NYSE: HRB ) climbed 3% today after Morgan Stanley upgraded the tax preparation company from equal weight to overweight.
So what: Along with the upgrade, analyst Thomas Allen boosted his price target on the stock to $33 per share (from $25), representing about 24% worth of upside to yesterday's close. The stock has slipped in recent weeks on worries that Obamacare -- and the new growth opportunities it provides H&R -- would be delayed, but H&R's recent deal with GoHealth insurance gives Allen some comfort that the upside potential is real.
Now what: Morgan now expects H&R to earn about $2.20 per share in 2015. "While HRB has traded off over the past few months on concerns [the Affordable Care Act] will be delayed or de-funded, we have warmed up to the stock, especially after HRB partnered w/ GoHealth," said Morgan in a note to clients. "We've adjusted our [estimates] to reflect our latest thinking on ACA/buyback." Of course, with the stock now up about 70% from its 52-week lows and trading at a 15-plus P/E, I'd wait for H&R's new partnership to actually bear fruit before betting on it.
More stable ways to build wealth
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.