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Loyalty cards help drive business for many airlines.

Investors, don't get too excited about Groupe Aeroplan Inc.'s decision to increase its annual dividend by 20 per cent to 60 cents per share, Canaccord Genuity analyst Candice Williams says.

Aeroplan's free cash flow does not support a sustained return of cash to shareholders at the current rate, she cautions, citing increasing competition and potential changes to credit card legislation that could affect loyalty programs.

Downside: Ms. Williams rates the stock a "hold" with a $13 price target.

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Paladin Labs Inc.'s first-quarter earnings reflect solid profitability and strong performance from existing products, Desjardins Securities analyst Pooya Hemami says.

The pharmaceutical company has more than $190-million in cash and is looking for an acquisition or to establish operations in an emerging market by year-end, which will strengthen its prospects for growth, Mr. Hemami writes in a research report. His sales forecast of $134.7-million for the year is at the upper limit of the firm's guidance.

Downside: Mr. Hemami raised his target price for Paladin from $35 to $41 and rates the stock "hold." He believes the shares are "fully valued" at their current level around $44.

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Genivar Inc. missed first-quarter earnings estimates and faces a weak second quarter, with margins that are likely to soften further, RBC Capital Markets analyst Sara O'Brien says.

The engineering services firm hopes to begin a global acquisition strategy by the end of this year. A 1,000-employee acquisition would add about 10 per cent to its earnings per share for the year, she writes in an analyst report.

Downside: Ms. O'Brien lowered her target price to $31 from $33. "We do not see a positive, short-term catalyst to drive significant stock gain," she said.

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Secure Energy Services Inc. stock has "superb long-run growth potential" and will benefit in many ways from the company's $131-million acquisition of Marquis Alliance, says Raymond James analyst Andrew Bradford.

"We like the immediate impact of the Marquis Alliance acquisition on Secure's per share profit measures; we like the longer-term potential for operating synergies to generate additional cash flow with relatively little capital investment; we also like Secure's ongoing ability to allocate high-return growth capital, and Marquis Alliance probably enhances this potential," he says.

Upside: Mr. Bradford raised his target price to $9 from $8 and rates the stock "market perform."

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Whiterock REIT first-quarter earnings reflect the strength of its active acquisition program as well as the solid operating performance of its property portfolio, TD Newcrest analyst Sam Damiani says.

The REIT has reduced its leverage to a manageable level, with net debt at about 8.5 times EBITDA, and about 80 per cent of its net operating income comes from office properties, which have the potential to deliver solid growth in the years to come, he says.

Upside: Mr. Damiani raised his price target to $15 from $14, adding: "We believe investors will reward Whiterock with a further improved relative valuation to the peer group." He rates the units "buy."

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