The best performing equity group since President Bush won reelection last week has been the HMO sector. Stocks like United Health (UNH), Wellpoint (WLP), Anthem (ATH), and Aetna (AET) have been on fire. PacifiCare (PHS), a second-tier player and long-time Peridot holding, has also rallied, from a $34 close on election day to $44 as of yesterday. This morning, Banc of America Securities finally decided to cave and upgrade the stock from "sell" to "neutral." The firm raised its price target on PHS shares from $25 (it's 52-week low) to $44 (it's current price). The report also pointed out, for those of us who are less than perceptive, that the "sell" rating had "not been a good call."

As happens too often on Wall Street, we have another case of an analyst being completed wrong and having to throw in the towel and admit defeat. Why would anyone follow B of A's advice on PacifiCare when they have been dead wrong on the stock for as long as the eye can see?