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Analysts are quickly jacking up price targets on Open Text Corp. after the Canadian business software maker beat expectations across the board Wednesday in reporting second-quarter results.

Adjusted net income was $1.21 (U.S.) a share for the quarter ended Dec. 31, easily surpassing Street forecasts of $1.07, with revenue of $267.5-million also surprisingly robust as licence revenue made a strong comeback.

The company continues to generate strong cash flow, ending the quarter with $341-million on hand. It's already deploying it, announcing Wednesday a $182-million deal to acquire smaller competitor Metastorm to bolster its mobile credentials. TD Newcrest believes the deal will add 23 cents to annualized earnings per share once integrated.

The company indicated its pipeline of customers is building nicely and at its healthiest level in a long time.

"We expect licence growth to remain strong through the second quarter of 2011, given new products, accelerating partnerships and improved sales execution," commented CIBC World Markets Inc. analyst Stephanie Price.

Upside: TD Newcrest analyst Scott Penner hiked his price target by $11 to $54; Canaccord Genuity analyst Eyal Ofir by $5 to $60; and Ms. Price by $6 to $60.

Shutterfly enjoyed strong holiday-quarter results and provided full-year guidance well above consensus expectations, benefiting from photo sharing and printing moving online as well as operating efficiencies. Canaccord Genuity analyst Heath Terry believes investments to be made this year will ultimately lead to higher-margin digital services and continued online share gains.

Upside: Mr. Terry raised his price target by $2 (U.S.) to $38, suggesting stock dips will be buying opportunities.

Home Capital Group Inc. sailed through the financial crisis and continues to grow through increased penetration of the mortgage broker channel, said Desjardins Securities Inc. analyst Michael Goldberg. It delivers stronger earnings growth and profitability than Canadian banks with stronger capital ratios, yet continues to trade at a discount valuation, he noted.

Upside: Mr. Goldberg raised his price target by $6 to $62.

Enbridge Income Fund Holdings Inc.'s Saskatchewan pipeline system is generating superior rates of return due to an accelerated recovery of capital that's allowed through the regulatory toll structure. But there's a risk earnings and cash flow will decline if regulatory returns are reduced to reflect lower operating risk as reserves in the Bakken region increase, warned Canaccord Genuity analyst Juan Plessis.

Upside: Mr. Plessis maintained his "sell" rating but hiked his target by $3 to $14.

A recent downturn in shares of Nalco Holding Co. has created an attractive buying opportunity, argued Canaccord Genuity analyst John Quealy. The maker of chemicals used in water treatment and other industrial processes reported earnings Wednesday that were below forecasts, but Mr. Quealy is impressed with the company's growing presence in high-growth regions and its focus on innovative technologies.

Upside: Mr. Quealy cut his price target by $5 to $33 and maintained his "buy" recommendation.

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