CenturyLink, Inc. (NYSE: CTL) has been a down and out stock for quite some time. In fact, its shares had lost about 75% of their value since 2011. Even the 2017 acquisition of Level 3 has not seemed to entice shareholders. And cutting the dividend in 2013 and then again in within the last year has’t exactly been a confidence booster.

What if all the bad news has been priced into CenturyLink? Wells Fargo seems to think that is the case.

Analyst Jennifer Fritzsche upgraded CenturyLink’s rating to Outperform from Market Perform. She also raised her target to $14 from $12 in Thursday’s call. Fritzsche believes that CenturyLink is now starting to show more of its fiber roots from Level 3 that will help in dark fiber and in wireless ahead.

24/7 Wall St. had included CenturyLink in our daily analyst upgrade and downgrade montage, but this call was large enough that it deserved a deeper look.

Jennifer Fritzsche even called CenturyLink an underappreciated story by Wall Street — and she called it out as being “too cheap to ignore.” That said, this is not a view on how CenturyLink will do on its second quarter earnings as much as it is a longer horizon call.

CenturyLink’s stock had been down handily in 2019, with losses of almost 30% ahead of the call in 2019 alone.

With earnings of $1.19 per share in 2018, Refinitiv’s consensus earnings estimates are $1.31 per share in 2019 and $1.32 per share in 2020. The $1.00 per share annualized dividend creates a monster yield of close to 9%, and dividend investors have to of course weigh that $36 billion worth of long-term debt in the scenario of wondering how safe its dividend is.

While one Wall Street analyst upgrade may be a one-off item, multiple upgrades from analysts might imply something good is happening. The firm’s Guggenheim and Citigroup both upgraded CenturyLink in May, and while these were only to “Neutral” this still removed two vocal “Sell” ratings.

Despite such a strong gain on the day, investors should pay attention to the share volume of the day. The 10.7 million shares that had traded just 30 minutes ahead of the closing bell was about 2 million shares shy of an average day’s trading volume. Some technicians would warn about high percentage pops on low trading volume. That low volume also stands out considering the short interest was 98.9 million shares at the most recent data.

CenturyLink shares were last seen trading up 7% at $11.70 on Thursday, with a 52-week range of $9.64 to $24.20. The consensus analyst target price from Refinitiv was also shown as $12.77 ahead of this call.

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