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TSE:OTEX

Open Text (OTEX.TO)

35.84
+2.02 (5.97%)
as of Oct 13, 2026, 3:29:39 pm Market Open.
500 watching
0
COMMENT

Prefers this to Shopify. Less demanding multiple at 14-15x. Doesn't have the 30-40% gut-wrenching pullbacks, and sometimes boring is beautiful.

BUY
A solid long-term hold, but doesn't see a breakout coming. Wouldn't be shocked if another company bought this.
PAST TOP PICK
(A Top Pick May 07/19, Up 7%) They are great acquirers. Their last acquisition should be 10% accretive, but there are questions about that. But he's not concerned; he's confident based on their track record. Their valuation discount will close when they put up consistent cloud results (which they've been doing) and doing more acquisitions. Buy this int he mid-$50's.
TOP PICK
It is the most amazing stock. They reported a no-surprise quarter. They just made an acquisition. It has recovered really nicely since July. It is a good core holding. It is fairly tightly held. (Analysts’ price target is $63.07)
PAST TOP PICK
(A Top Pick May 07/19, Up 10%) Recently got a good kick from recent acquisition. Should be able to make decent money on it. Accretive. Still adding to it.
HOLD
They development information management software. He has a price target of $44.50 US, which is pretty fairly valued today. It is a leader in enterprise information software.
BUY
He likes it, but has had a rough time with a proposed takeover of a UK company (https://ca.finance.yahoo.com/news/open-text-weighs-takeover-offer-193049589.html), but many investors bailed on OTEX in reaction. He still likes OTEX's fundamentals.
BUY

Sell Fortis and AQN to buy OTEX? AQN is a great utility; they've done a good job growing. He owns Emera in this space. Utilities have done very well until recently when a trade deal looked possible. He'd own OTEX before AQN, because it has generated a higher return on equity historically. Occasionally, OTEX makes a big acquisition to surprise the market in a good way. OTEX is doing more cloud work, which amounts to wider margins.

BUY
Great company. Very diverse client base globally. Strategic partnership with Google should drive revenue and accelerate organic growth. So they won't have to rely as much on acquisitions to drive growth. Not a high P/E ratio. Very capable acquirer in a fragmented industry.
STRONG BUY
It sells at a reasonable valuation. They run a great company. They buy their rivals and bring them in and increase profitability.
BUY ON WEAKNESS
Has it sold off enough to get in? Phenomenal Canadian company. You can buy this cheaper. $62 is his target. Start buying this in the $40's. His rule is to buy a third at a time.
TOP PICK
Growth by acquisition strategy. Great migration from license sales to the cloud. Continued great growth. Excess free cash flow pays down the debt. Yield is 1.71%. (Analysts’ price target is $61.57)
BUY
These stocks come back from a sell off. The stock is at a straight line up. Hasn’t really gone over $60, so he would want to see it break through to buy there.
TOP PICK
They boast 100 million users globally with 75% of revenues coming from subscriptions. 95% of business comes outside Canada. That lessens risk.They spend their large cash flow ($6.2 billion in the last 20 years) buying businesses and they do it well. The stock has generated an annual compound rate of return of 13.5% over 20 years, double the TSX. (Analysts’ price target is $61.78)
COMMENT
It's a good play, but has its challenges. The valuation has improved. Doesn't hate it, but doesn't own it.
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