Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
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 Cisco Systems (NASDAQ: CSCO ) fell nearly 1% in premarket trading Tuesday after Wunderlich downgraded the networking gorilla from buy to hold.
So what: Along with the downgrade, analyst Matthew Robison lowered his price target to $24 (from $25), representing about 5% worth of upside to yesterday's close. So while contrarians might be turned off by Cisco's price strength over the past month, Robison's call could reflect a growing sense on Wall Street that its valuation is becoming a bit stretched.
Now what: According to Wunderlich, Cisco's risk/reward trade-off is rather attractive at this point. "We came away from industry interviews in recent weeks with the view that the market has less interest in the Cisco product suite than in past transitions," said Robison. "We see the range of alternatives for network automation/software defined networking (SDN), network function virtualization (NFV), and cloud services as dilutive to the Cisco installed base upgrade opportunity." Of course, when you couple Cisco's still-massive scale advantages with its 3%-plus dividend yield, conservative long-term investors might want to take Wunderlich's bearishness with a grain of salt.
Nine rock-solid dividend stocks you can buy today
One of the dirty secrets that few finance professionals will openly admit is the fact that dividend stocks as a group handily outperform their non-dividend-paying brethren. The reasons for this are too numerous to list here, but you can rest assured that it's true. However, knowing this is only half the battle. The other half is identifying which dividend stocks in particular are the best. With this in mind, our top analysts put together a free list of nine high-yielding stocks that should be in every income investor's portfolio. To learn the identity of these stocks instantly and for free, all you have to do is click here now.