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 Lennar (NYSE:LEN) popped 3% this morning after Goldman Sachs upgraded the homebuilder from neutral to conviction buy.

So what: Along with the two-notch upgrade, analyst Eli Hackel boosted his price target to $48 (from $38), representing about 21% worth of upside to yesterday's close. While value investors might be turned off by the stock's strength in recent months, Hackel thinks there's plenty of room to run given his view that Lennar's subsidiaries are underappreciated by Mr. Market.

Now what: According to Goldman, Lennar's risk and reward trade-off is particularly attractive at this point. "We believe the market is valuing LEN almost exclusively for its core homebuilder business, while ascribing little value to its ancillary businesses," Hackel wrote. "We did a deep dive on FivePoint communities, Rialto and Multifamily, including modeling out the profitability and value creation of each business, driving our estimates higher and putting us 2%/9% above Street EPS in 2014/2015." Of course, with Lennar shares up nearly 20% over the past three months and trading at a P/E premium to the industry, I'd wait for a wider margin of safety before buying into Goldman's conviction call. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.