UPDATE: Goldman Sachs Upgrades Lorillard, Inc to Buy; "Top Tobacco Pick"

On Monday, Goldman Sachs upgraded shares of Lorillard

from Neutral to Buy and maintained a $60 price target. Lorillard is analyst Judy Hong's “top tobacco pick.” The analyst believes the cigarette market is entering a “menthol regulation lull” and her price target implies “a sizeable menthol regulation discount already embedded in the current stock price.” Hong forecasts “highly visible double-digit EPS growth” due to “steady fundamentals, lower costs, and share buyback.” Shares of Lorillard are responding well to the upgrade, trading up 4.1 percent to $53.12 in Monday's pre-market trading. Hong's price target is 13 percent above current levels.