In a report published today BofA Merrill Lynch Upgraded the rating on Siemens AG (SI) to Buy from Neutral with a price target of $144.37.

FILES - A picture taken on June 1, 2008 shows a huge symbol of the Euro in front of the European Central Bank (ECB) in Frankfurt/M., western Germany. The US Federal Reserve struggled with central bank partners on September 26, 2008 to avert a "money market meltdown" as US lawmakers wrangled over a plan to stem the worst financial crisis most have ever known. Central banks added 13 billion dollars (8.8 billion euros) to an emergency fund that has become crucial for European banks, bringing the total made available so far to 290 billion dollars.   AFP PHOTO  /  DOMINIQUE FAGET

“We are upgrading Siemens from Neutral to BUY. Our price objective (PO) remains Eur106, implying c.17% upside potential, plus a >3% dividend yield. We downgraded Siemens in early Jan 14 when the stock was a bit higher and the upside looked more limited, but at these levels (all in PE of c.13x FY14 and c.11.5x FY15,a 15-20% sector discount), we think the shares offer an attractive risk/reward balance.” BofA Merrill Lynch said

“We think the upside will be driven by (i) the ongoing cost and portfolio restructuring story under CEO Joe Kaeser, which we think will be taken to the next phase at the May 8 capital markets day, (ii) cyclical and structural growth opportunities in automation markets, which we think the market underestimates, (iii) support from a Eur4bn share buy-back to be executed over the next 18 months and (iv) a strong balance sheet allowing Siemens to enhance its portfolio and earnings” it added

Shares of Siemens AG (SI) closed at $125.75 on Friday.