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 GrafTech International Ltd. (NYSE:GTI) sank 6% this morning after Jefferies downgraded the graphite products company from buy to hold.

So what: Along with the downgrade, analyst Luke Folta planted a price target of $13 on the stock, pretty much exactly where it closed yesterday. While momentum traders might be attracted to GrafTech's strong share price in recent months, Folta is concerned that the current valuation overlooks several near-term headwinds.

Now what: According to Jefferies, GrafTech's risk and reward trade-off is pretty balanced at this point. "Following the ~36% rise in valuations since our upgrade and incorporating a weaker pricing trajectory for GE and needle coke in 2014, we lower our rating to Hold (from Buy)," Folta noted. "We continue to see LT upside given industry restructuring and gradual demand improvement though expect 2014 will be another challenging year for mkt. trends." When you couple those challenges with GrafTech's 50-plus forward P/E, it's tough to disagree with Jefferies' cautious stance.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool owns shares of GrafTech International Ltd. 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.