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ARND WIEGMANN/REUTERS

These are some of the key analyst actions on the Street today.

UBS believes gold is poised to take a sharp turn higher amid growing expectations that the U.S. Federal Reserve is about to unleash a third round of quantitative easing.

Friday's ugly U.S. jobs report means there is now "a strong likelihood" of the Fed action after its monetary policy meeting wraps up on Thursday, UBS analysts said in a note, and this "sets the stage for the continuation of the precious metals rally."

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UBS raised both its one-month and three-month gold forecasts to $1,850 (U.S.) an ounce. They were previously $1,700 and $1,750, respectively. That implies a more than $100 bounce from where gold is trading at today.

But it's not just gold UBS is bullish on: It thinks silver is going to shine too, and will actually outperform gold in the near term. It raised its one- and three-month silver forecasts to $37 (U.S.) an ounce. They previously were $32 and $35, respectively.

Precious metals equities, UBS believes, are going to benefit. On average, it raised its price targets in the gold sector by 12 per cent and in the silver sector by 18 per cent.

But it did highlight three companies investors should refrain from buying right now, because of their recent run-up in stock prices: Franco-Nevada Corp., Royal Gold Inc. and Hecla Mining Co. It downgraded all three from "buy" to "neutral."

________

Telus Corp.

TD Securities analyst Vince Valentini has upgraded Telus to "hold" from a "reduce" rating, citing a share price that has lagged peers and the S&P/TSX index recently.

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TD also cited valuation reasons for the action, noting the Telus shares are going at a discount to competitor BCE on an enterprise value/earnings before interest, taxes, depreciation and amortization basis. It also believes odds are high that Telus will succeed in collapsing its non-voting shares into voting shares.

Upside: TD left its 12-month target price unchanged at $60. But CIBC World Markets, which reiterated its "sector performer" rating, raised its price target by $4 to $65 today

________

Lululemon Athletica

A 33 per cent rise in second-quarter sales reflects consumers' continued strong appetite for the brand as well as minimal competitive threats, commented UBS, which raised its earnings forecasts for this year and next. UBS expects a particularly robust fourth quarter for the retailer given a pipeline of strong products. "We view LULU as among the best growth stories with a sizable runway for growth in the U.S. and e-commerce," it said.

Upside: UBS hiked its price target by $8 (U.S.) to $88 and reiterated a "buy" rating.

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Kraft Foods Inc.

RBC Dominion Securities has upgraded Kraft Foods Inc. to "outperform," urging investors to scoop up shares in the wake of Friday's steep 5.5 per cent sell-off, spurred by disappointing company guidance. Analyst Edward Aaron said shares should be purchased before the company splits its snacks business from its grocery division on Oct. 1.

"While the sell-off was understandable considering that consolidated fiscal year 2013 guidance came in about 25 cents below Street estimates, the extent of the selling pressure was surprising to us based on our view that the fundamental story has not changed," said analyst Edward Aaron.

He added that most of the guidance shortfall reflected non-operating factors, such as currency, higher interest and pension expenses, while long-term targets were in line with expectations.

Upside: Mr. Aaron, who previously rated the stock as "sector perform," raised his price target by $2 to $44.

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Bell Aliant Inc.

A solid high-yielding stock, with stable fundamentals and a strong management team, says CIBC World Markets analyst Robert Bek. "However, the company is dependent upon a very mature wireline business that will continue to see pressure," and growth will continue to prove difficult given the company's asset mix, he said.

Downside: Mr. Bek cut his price target by $1 to $26 and affirmed his "sector performer" rating.

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Cogeco Cable Inc.

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Shares have become even cheaper relative to peers since the company announced the acquisition of U.S. cable operator Atlantic Broadband in July. But CIBC World Markets analyst Robert Bek doesn't see that changing much anytime soon. "We do not expect to see investor buying support until the company can firmly demonstrate the U.S. opportunity, which should take some time," he said.

Upside: Mr. Bek cut his price target by $2 to $41 and reiterated a "sector performer" rating.

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

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