Lorillard Inc. Upgraded to “Buy” at Goldman Sachs (LO)

Before the opening bell on Monday, Goldman Sachs raised its rating on cigarette company Lorillard Inc. (LO) to “Buy” from “Neutral.”

Goldman has a $60 price target on Lorillard, suggesting the company’s stock will appreciate 16% from its current price. In raising its rating on LO, GS also noted that Lorillard has a nearly 5% dividend yield.

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GS analyst Judy E. Hong had the following comments about Lorillard: “While LO is not out of the woods in terms of the FDA’s potential regulation of menthol, we believe we may be entering a period of limited regulatory headline risk and the stars are aligning with the rest of the story as fundamentals remain solid, e-cig category could get another burst with the national entries by MO & RAI, and valuation has de-risked vs. the Staples group.”

See Also: Why Tobacco Stocks Can Make Good Dividend Investments

Lorillard stock was up $2.11, or 4.14%, in pre-market trading. YTD, the company’s stock is up 3.74%.