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Aetna Upgraded to “Buy” at Jefferies; Sees 45% Upside (AET)

Health benefits provider Aetna Inc. ( AET ) on Tuesday caught a big upgrade from analysts at Jefferies & Co.

The firm said it boosted its rating on AET from "Hold" to "Buy" while lifting its price target from $47 to $51. That new target suggests a 45% upside to the stock's Monday closing price of $35.23.

A Jefferies analyst commented,, "AET's 25% 2Q EPS outperformance, coupled with what we believe is conservative MLR guidance in 2H11, several 2012 tailwinds, and low government exposure support our upgrade. We had been getting more constructive on AET heading into earnings, so the 18% decline over the last month has created a nice entry point. We see upside of 45% with downside at $29 (6.5x a modest 2012 EPS decline)."

Aetna shares were unchanged in premarket trading Tuesday.

The Bottom Line

Shares of Aetna ( AET ) have a 1.70% dividend yield, based on last night's closing stock price of $35.23. The stock has technical support in the $32-$34 price area. If the shares can firm up, we see overhead resistance around the $38-$39 price levels.

Aetna Inc. ( AET ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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