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Guests are seen during the Magna International annual general meeting in Toronto on Thursday, May 10, 2012.Aaron Vincent Elkaim/The Canadian Press

Inside the Market's roundup of some of today's key analyst actions. This file will be updated during the trading day. For breaking analyst actions prior to market open every day, read our Before the Bell morning report.

Magna International Inc.'s fourth-quarter profit blew past Street expectations and analysts are responding today by jacking up their price targets, although with some caution given that the stock is already trading at a pretty rich valuation.

Bolstered by the rebound in auto sales across the globe, the parts maker reported quarterly earnings of $2.08, well ahead of the consensus mean estimate of $1.54 and up 56 per cent from a year earlier. Sales growth was driven by both industry and new business growth, and margins benefited from strong business execution in North America and improving operations in Europe.

Goldman Sachs analyst Patrick Archambault went as far as upgrading his recommendation on the stock, moving to a "neutral" rating from a "sell" as he raised his price target to $101 (U.S.) from $78.

"Our rationale for the sell rating in April 2012 was that MGA was trading at a premium to other cyclical suppliers (e.g. TEN, TRW, LEA) despite a slower growth outlook and execution concerns in the European interiors/exteriors business," Mr. Archambault was quoted as saying by StreetInsider.com. "Over the course of this time both revenue and EBIT growth rates have been stronger than expected on content wins and better execution."

Canaccord Genuity analyst David Tyerman expressed similar caution as he raised his target to $103 from $92.

"Magna continues to perform very strongly, but we believe there is only modest upside to our target due to the company's much-increased valuation. Accordingly, we continue to rate MGA hold," he said in a research note. "We expect further good EPS growth in the next couple of years. Sales growth looks likely to slow, but MGA should generate material margin expansion in Europe and emerging markets. Share buybacks should further boost EPS growth."

BMO Nesbitt Burns analyst Peter Sklar raised his price target to $106 from $98 as he reiterated an "outperform" rating.

"While the strength of the North American result in Q4 may have been somewhat exceptional, we believe it could provide an indication of the margin improvement Magna could eventually achieve company wide through its continued focus on implementing World Class Manufacturing standards," Mr. Sklar commented.

Elsewhere, CIBC World Markets raised its price target to $110 from $100 and reiterated a "sector outperformer" rating. And JPMorgan upgraded its rating to "neutral" from "underweight" and raised its price target to $102 from $93.

The average analyst target is now $99.18, according to Bloomberg data.

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Credit Suisse analyst Christian Buss upgraded Abercrombie & Fitch Co. to "outperform" from "neutral," applauding the company's decision to move away from a strategy of charging premium prices. Credit Suisse also raised its price target to $52 (U.S.) from $36.

"In our view, one of the big challenges that Abercrombie & Fitch has faced has been a stubborn emphasis on price points that do not compete effectively with the rise of low-cost teen apparel retailers like Forever 21, H&M, and increasingly UNIQLO. We finally see potential for the company to price its product appropriately in the marketplace, avoiding the roller-coaster of downside surprises to unit," the analyst said.

"We expect a more price-competitive strategy to lead to a return to positive earnings momentum when combined with: 1) Aggressive cost controls; 2) Continued emphasis on appropriate square footage reduction in the U.S.; 3) Accelerated investments in eCommerce; 4) Tighter control of inventory; and 5) Renewed emphasis on return of cash to shareholders," the analyst wrote in a research note.

Abercrombie reported fourth-quarter earnings per share of $1.34, well ahead of the Street consensus of $1.03, thanks to lower expenses. Credit Suisse now expects fiscal year 2014 earnings per share to reach $2.47, up from its previous estimate of $1.61.

The analyst consensus price target over the next year is $41.96 (U.S.).

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Despite missed estimates and higher-than-expected costs, Enerflex Ltd. has earned a rating upgrade and price target hike from Raymond James analyst Andrew Bradford.

Enerflex reported cost overruns on international projects and missed estimates on earnings before interest, taxes, depreciation and amortization by $10-million, noted Mr. Bradford. However, fourth-quarter bookings were up 59 per cent year-over-year and the company boasts an "inherently high free cash generating business model" and a growing cash position.

He upgraded Enerflex to "outperform" from "market perform" and raised his price target to $19 (Canadian) from $15.50. The analyst consensus price target over the next year is $18.07, according to Thomson Reuters.

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Exchange Income Corp. delivered a relatively soft fourth quarter due to ongoing weak performance at its WesTower telecommunications construction subsidiary, as rapid growth caused inefficiencies, noted Canaccord Genuity analyst Chris Bowes.

"With its incredibly rapid growth phase behind it, we believe management is now focused on driving WesTower margins back to the 8-10 per cent range that it delivered two years ago. To that end, new management and a significant restructuring have been installed," said Mr. Bowes.

"But earning back investor confidence will take time."

He trimmed his price target to $26 (Canadian) from $28 and maintained a "buy" rating. The average analyst target is $25.08.

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Unseasonably cold weather has resulted in Desjardins Securities analyst Jackie Przybylowski cutting her price target for Labrador Iron Ore Royalty Corp.

Labrador Iron's fourth-quarter 2013 adjusted earnings per share of $2.42 was slightly below Ms. Przybylowski's estimate of $2.50, partly due to the severe cold weather in December.

"LIORC warns that the 'polar vortex' will likely have negatively impacted operations in early 2014 as Carol Lake continues to be negatively impacted by cold weather," she noted in a research note.

She reduced her first-quarter 2014 production estimate to 3.5 tonnes, down from production of 4.0 tonnes in fourth quarter 2013.

She maintained her "hold" rating and lowered her target price to $32.00 (Canadian) from $33.00. The analyst consensus price target over the next year is $35.09, according to Thomson Reuters.

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In other analyst actions:

RBC Dominion Securities hiked its price target on Alimentation Couche-Tard to $86 (Canadian) from $78 and maintained a "sector perform" rating.

CIBC World Markets raised its price target on Major Drilling Group International to $9.50 (Canadian) from $8.50 and maintained a "sector outperformer" rating.

CIBC World Markets raised its price target on Teranga Gold to $1.50 (Canadian) from $1.30 and maintained a "sector outperformer" rating.

UBS initiated coverage on several blue chip consumer stocks today. Clorox got a "sell" rating and $80 (U.S.) price target; Coca-Cola Enterprises a "neutral" rating and $50 (U.S.) target; Colgate-Palmolive a "buy" rating and $70 target; Dr. Pepper Snapple a "neutral" rating and $54 target; PepsiCo a "neutral" rating and $85 (U.S.) target; and Procter & Gamble a "neutral" rating and $81 (U.S.) target.

Wells Fargo downgraded Cliffs Natural Resources to "underperform" from "market perform" and cut its valuation range to $12-$14 from $19-$24.

Cantor Fitzgerald downgraded Intuitive Surgical to "hold" from "buy" and maintained a $450 (U.S.) price target.

For more analyst actions, breaking investing news and analysis, follow Darcy Keith on Twitter at @eyeonequities

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