TSE:OTEX

Open Text (OTEX.TO)

34.25
+1.62 (4.96%)
as of Sep 3, 2026, 8:00:00 pm Market Open.
500 watching
0
Investor Insights
star iconSep 3, 2026, 12:00 am

This summary was created by AI, based on 21 opinions in the last 12 months.

OpenText (OTEX) has drawn mixed reviews from experts, reflecting a landscape of cautious optimism versus skepticism. While some analysts highlight the stock's potential value given its low PE ratio of 5.2x and a 4% dividend yield, others stress the challenges posed by changes in the AI landscape, which could disrupt traditional software pricing models. The stock is currently building a base around the $28-$35 range, with a significant breakout potential if it surpasses the $35 resistance. However, concerns about its lack of organic growth, management changes, and heavy reliance on acquisitions have cast doubts on its long-term viability. As a result, many suggest exploring better opportunities in the software sector while keeping an eye on OpenText’s movements, especially after earnings reports.

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Consensus
Cautious
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Valuation
Undervalued
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TOP PICK
75% of its revenue is recurring. They're highly acquisitive, so they've compounded capital 20% a year for a long time. A long track record. It trades at 11x EBITDA vs. peers 15x. Their last quarter disappointed, but it's now a buying opportunity. For a tech company, it's also defensive: Fortune 500 companies buy their products. Will do well in this environment. (Analysts’ price target is $61.78)
HOLD
They are a large cap slow growth tech name. They make acquisitions. It is fine as a longer term hold. Slow and steady.
BUY ON WEAKNESS
The company is well run. He sees no reason to not buy more when the stock dips.
TOP PICK

It's trading near 52-week highs, though held back a little compared to its peers. This will change given their focus on the cloud and maybe an acqusition. They will grow around 5% organically. They will buy back a lot of stock. Their Google partnership in the cloud holds great potential. Trades at 11x EBITDA vs. 17x peers. (Analysts’ price target is $59.97)

BUY ON WEAKNESS
Sell CGI to buy OTEX? He watches it. OTEX is a leader in its field in Canada, but the stock is pricey. Buy in the mid-$40s. It reports on August 1.
BUY

Fine company. They buy companies to grow, paid by excess free cash flow. Low valuation, too. There's good growth; they just struck a partnership with Google.

BUY

Their partnership with Google and Mastercard He's followed this many years and once owned it. Their partnership with Google is excellent; Google is number three in the cloud space. This partnership may accelerate OTEX's organic growth which has traditionally been tepid and done through acqusitions. This trades at 14x earnings when the software space is much higher. He likes OTEX.

TOP PICK

They've done a really good job on recurring revenue.  Fantastic balance sheet.   Street consensus is BUY. Price target : $60.64

HOLD
If you bought it as a trade, you might want to take some profits. But technically, there's nothing he can point to that says sell it.
PAST TOP PICK
(A Top Pick May 29/18, Up 26%) They grow by acquisition. The CEO is a little off-putting, but he is brilliant and does a great job identifying targets.
STRONG BUY
Loves it and it is slightly undervalued. They continue to make a lot of money off software licensing. They sit on a lot of cash, but get into debt when they make acquisitions. A high-quality Canadian tech name, which are rare.
TOP PICK

An underloved Canadian software stock that is now focusing on the cloud, reducing lumpiness in their business. Trading at 11x EBITDA vs. peers at 17-18x. They close the valuation gap. (Analysts’ price target is $60.91)

SHORT
They have 2x debt-to-EBITDA. He's shorting the stock. It's pretty expensive, and their access to capital will decline since we are late in the cycle.
BUY ON WEAKNESS
Makes him mad that they don't own it. In the right place in the right time. They sell Enterprise information Management software. It allows the companies to digitize their processes. He would buy it in the high $30s
WAIT
Follows it very closely, but doesn't own it. Software for enterprise information management, and they're extremely good at it. Fabulous Canadian story. Clients all over the world. Well diversified. Recurring revenues. Gartner Research has it as one of the leaders. Double digit recurring growth. But it's expensive. He'd buy in mid-30s.
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