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 Texas Instruments (NASDAQ:TXN) gained about 1% today after RBC Capital upgraded the semiconductor giant from sector perform to outperform.

So what: Along with the upgrade, analyst Doug Freedman raised his price target to $57 (from $49), representing about 27% worth of upside to yesterday's close. So while contrarian traders might be turned off by Texas Instruments' price strength over the past year, Freedman's call could reflect a sense on Wall Street that its growth prospects still aren't fully baked into the valuation.

Now what: According to RBC, Texas Instrument's risk/reward trade-off is rather attractive at this point. "The company has been laser focused on its capital management strategy, and we believe TXN delivers FCFs at the upper-end of its 20-30% of revenues range (RBCe: CY15/29%, CY16/28%)," said Freedman. "We suspect TXN is benefiting more from unit growth and mix shift vs. pricing power, which is driving revenue/GM upside as utilizations remain low (high-70% range)." Of course, when you couple Texas Instruments' hot stock price with its still-intense competitive environment, I'd hold out for a wider margin of safety before betting on that bullishness. 

Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.