Friday's analyst upgrades and downgrades

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Inside the Market's roundup of some of today's key analyst actions. This file will be updated during the trading day.

Analysts are rewarding Royal Bank of Canada and Toronto-Dominion Bank with a bevy of price target hikes after both financial institutions beat Street expectations for fiscal second-quarter earnings.

RBC's profit jumped 15 per cent to $2.2-billion from a year earlier, while TD's rose 14 per cent to $2.1-billion after stripping out one-time items. They enjoyed better earnings everywhere from personal and commercial banking to wealth management.

For RBC, Canaccord Genuity raised its price target to $81 (Canadian) from $80 and maintained a "buy" rating. Desjardins Securities raised its target to $84 from $82 and maintained a "buy" rating. BMO Nesbitt Burns raised its target to $76.50 and reiterated a "market perform" rating. And CIBC World Markets raised its target to $82 from $80 and reiterated a "sector outperformer" rating. The median price target is now $80.50, up from $78 a month ago, according to Thomson Reuters data.

CIBC World Markets analyst Robert Sedran expressed surprise that capital markets revenues were as strong as they were for RBC. And, given a lacklustre first quarter, he was impressed with the performance in the wealth management operations, which got a boost from higher fees and more assets under management, as well as lower loan losses and expenses.

"The strength that this bank has shown in recent periods has often come from differing segments from quarter to quarter. Again this time, the better-than-expected and well-diversified results support our positive stance on the shares," Mr. Sedran said in a research note.

Price targets for Toronto-Dominion Bank went up by a similar degree. Canaccord Genuity raised its target to $55 (Canadian) from $53 and reiterated a "hold" rating. Desjardins Securities raised its target to $61 from $60 and maintained a "buy" rating. BMO Nesbitt Burns raised its target to $54.50 and maintained an "outperform" rating. CIBC World Markets raised its target to $58 from $56 and reiterated a "sector outperformer" rating. The median price target is now $56, up from $53.50 a month ago.

"TD Bank reported strong second-quarter fiscal 2014 results on good organic growth, solid performance from past acquisitions, improved credit and a stronger US dollar," summed up Desjardins Securities analyst Doug Young. "Solid first half fiscal 2014 EPS growth and a strong capital position support our thesis that TD will continue to increase dividends at the fastest pace among the Canadian banks."

Canaccord Genuity analyst Gabriel Dechaine was sounding more cautious, however, noting that loan growth was sluggish in the second quarter, with net interest margins eroding in the U.S. "Until these trends stabilize/improve, which could support a higher valuation, we believe a hold rating is appropriate," he said.

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CIBC World Markets analyst Tom Meyer continues to recommend investors buy shares in Augusta Resource Corp. despite the company announcing that there's been a delay in receiving a permit to develop a quarter-billion-pound-per-year copper mine in Arizona.

Augusta said late Thursday that a final Record of Decision on the permit may be delayed until sometime in the third quarter, instead of this June, due to a recent sighting of an ocelot in the study area for the Rosemont project. There are concerns over water use and quality in the region.

"The further delay is disappointing, but should not be too surprising given the media attention and various critical market commentary about AZC's overly optimistic permitting timeline. In our view, permitting risks, including delays have been factored into the current low share valuation," Mr. Meyer said in a research note.

"On the positive side, this delay may potentially avoid future criticisms that the process was not carried out at a high standard," he added.

Mr. Meyer reiterated a "sector outperformer" rating on Augusta shares and a $4.75 (Canadian) price target.

Augusta recently rejected an unsolicited takeover offer from HudBay Minerals Inc. Desjardins Securities analyst Jackie Przybylowski suggested in a research note that the increased uncertainty around permitting could encourage Augusta shareholders to tender to Hudbay's bid, due to expire May 27.

Hudbay has offered Augusta shareholders 0.315 of a HudBay share for each Augusta share. "We expect that Hudbay will continue to extend its bid (in short increments) until Augusta's shareholder rights plan is cease-traded on July 15, 2014," said Ms. Przybylowski. "The increased degree of permitting uncertainty supports Hudbay's assertion that Rosemont permitting could drag."

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A site visit to a pair of Agnico Eagle Mines Ltd.'s gold mines in Quebec has CIBC World Markets analyst Alec Kodatsky more confident in the company's profitability.

The company's LaRonde mine appears set to deliver on production increases through 2016, while the Goldex mine appears to have overcome its operational challenges, said Mr. Kodatsky, who raised his price target on the stock to $40 (U.S.) from $38, while maintaining a "sector outperformer" rating.

"Overall, the individual systems across both mines demonstrated the typical Agnico style of well-oiled performance that has helped the company establish a trend of consistently beating market expectations for the past several quarters," he said.

Mr. Kodatsky also increased his earnings and cash flow estimates for Agnico Eagle after incorporating forecasts for the Canadian Malartic mine. That asset is set to be split between Agnico Eagle and Yamana Gold Inc., part of a joint bid for Osisko Mining Corp. announced in April.

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In other analyst actions:

RBC Dominion Securities downgrades Aéropostale to "sector perform" from "outperform" and cut its price target to $6 (U.S.) from $14.

Craig-Hallum upgraded Hilton Worldwide to "buy" from "hold" with a price target of $27 (U.S.).