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 upgrades and downgrades -- just in case their reasoning behind the call makes sense.
What: Shares of Motorola Solutions (NYSE: MSI ) slipped 1% today after Goldman Sachs downgraded the communication equipment technologist from neutral to sell.
So what: Along with the downgrade, analyst Simona Jankowski planted a price target of $67 on the stock, representing just 2% worth of upside to yesterday's close. So while momentum traders might be attracted to the stock's strength in recent weeks, Jankowski's call suggests an increasingly uneasy feeling on Wall Street over Motorola's risk/reward trade-off.
Now what: According to Goldman, there are much better opportunities in the sector. "We downgrade MSI to Sell from Neutral, as we see a lack of catalysts and path to drive outperformance," stated Jankowski. "Importantly, this is a relative rather than absolute call, as we see more upside elsewhere in our coverage given our sector view upgrade to Attractive. MSI does not have as much exposure to the key factors that make us more positive on the sector as a whole." Of course, with the stock continuing to trade at a seemingly reasonable forward P/E of 14, those concerns might be offering tech-savvy growth investors with an attractive entry point.
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