Shares of AT&T Inc. tacked on 1.0% in premarket trade Friday, after the communications services and media giant was upgraded at Raymond James, which cited relative valuation and debt reduction for its new bullish stance. Analyst Frank Louthan raised his rating to outperform, after being at market perform since April 2018, and established a stock price target of $34, which is 12% above Thursday’s closing price. Louthan said AT&T’s stock is being valued at a big discount to Verizon Communications Inc. , in terms of EPS and free cash flow, even though AT&T’s dividend yield of 6.7% is well above Verizon’s 4.2%. “We believe that the combination of positive earnings growth and delevering over the course of the year will being investors back to AT&T,” Louthan wrote in a note to clients. “As such, for longer term-oriented investors, locking in the 6.7% yield and waiting for mean reversion in valuation is likely to be rewarded.” AT&T’s stock has tumbled 18.3% over the past 12 months while Verizon shares have run up 20.0% and the Dow Jones Industrial Average has gained 3.4%.