TSE:OTEX

Open Text (OTEX.TO)

32.74
+0.07 (0.21%)
as of Jul 3, 2026, 8:00:00 pm Market Open.
500 watching
0
Investor Insights
star iconJul 4, 2026, 12:00 am

This summary was created by AI, based on 22 opinions in the last 12 months.

Open Text (OTEX) has received a mixed bag of reviews from industry experts. Several commentators highlighted concerns regarding the company's growth prospects, citing a low organic growth rate of 1-2% and significant challenges posed by the rise of AI technologies, which may disrupt traditional software pricing models. Some experts described it as deeply undervalued with a low PE ratio of 5.2x and a 4% dividend yield, arguing that it could be a buying opportunity for long-term investors. However, many stressed the importance of cautious investment, pointing to a broken long-term pattern in its chart and advising against purchasing at current levels. The overall sentiment suggests that while it's a value stock, risks remain about its management, acquisition strategy, and ability to adapt to changing market conditions.

consensus icon
Consensus
Negative
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Valuation
Undervalued
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ADBE,ADBE
BUY ON WEAKNESS
Great Canadian tech story. Doesn't own shares in company. Currently going through merger of A&D opportunity. Current tech selloff might be presenting good time to buy.
TOP PICK
More of a spec play, but pays a dividend over 3%. It has been unfairly beaten up this year. Their Google deal is a positive. Has decent fundamentals. Trades at only an 8.3x PE. He will enter this shortly. It's a valuation play. (Analysts’ price target is $61.40)
PAST TOP PICK
(A Top Pick Oct 05/21, Down 37%) It's down because it faces tough earnings comps. They did well during Covid--and still are--but aren't growing as fast. Also, they made a big purchase (they've made 80 over the past decade) of Microfocus, a large UK turnaround story. OTEX paid a lot for it and will finance it through debt and raise money in the high-yield market (at a rocky time). There's some worry over this deal, but he expects the deal to close and it will be very accretive.
WAIT
A fan. Safe and steady. Likes the verticalization. Big selloff from expensive valuation. Recent sizeable acquisition may take a while to digest, though management has a good track record. Stock may trade down further. He'd need to see progress on debt repayment.
COMMENT
Because of the volatility, a tradable security, not an investment. You could buy it down here. Recently named a leader in the Gartner magic quadrant. Double-digit growth rate, very strong balance sheet. (Analysts’ price target is $59.00)
BUY ON WEAKNESS
Likes company but would be hesitant to buy before market calms down. All tech names being sold off. If already own shares, continue to hold. Quality company that expects to do well in the future.
WATCH
It has 75 000 customers which is only 10% penetration of the software business. It also wants to increase its contact (has 40% right now) with more of the Global 10 000 companies. Its software offering is broader. Is an aquisitor. Would seriously consider buying. Regarding interest rates, he feels that the effect of rising rates is overblown. Even at 2, 3 or 4% rates are still at historical lows. These rates were normal in the late 1990's (4 1/2%) but the stock market was booming and was at a much higher valuation.
BUY
Added to their position 7 to 10 days ago. Software companies have been dragged down with tech. Sells to medium and large size businesses globally. Has compounded with 80 acquisitions over the decade. A good combination of growth and value at 12 to13 times earnings.
PARTIAL BUY
Develop and sell enterprise information management software. Price target of $61.75 USD. You could buy some here at $45, and some at 43. Use a stop of $40. Last week, Gartner Research named it as a leader in content services platforms. A quality name, he just doesn't have room for it. (Price targets refer to the NASDAQ listing in USD.)
HOLD
Believes company multiple is coming down due to interest rate increases. Owns the stock, but would not rush out to buy more stock.
BUY
Although it has not gone up as much as the high flyers, it has not gone down as much these days. Its growth has been by acquisition in the software management space. Very slow growth and there is a slow migration to on-going SAS recurring revenues. He loves their margins, however. It is trading in a fair range here. Unexciting, but a stable company.
BUY

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The company continues to show solid and stable growth. Cash flow is strong and they are able to grow by acquisitions. It will probably not grow as quickly as before and it does have sizable debt. Unlock Premium - Try 5i Free

TOP PICK
Over 95% recurring revenues. Global business and serial acquirer. 14.5% total compound return over 20 years, double the TSX and tech sector. It's boring tech but beautiful. (Analysts’ price target is $73.36)
HOLD
Quality business. 15x 2022 earnings, quite cheap. Trouble is there aren't many catalysts for growth. He's modelling only 3% EPS growth. Better places for new money. If you own it, it will continue to work. So hold it, or sell some covered call options. The stock isn't going to run away.
BUY ON WEAKNESS
One of the few tech companies in Canada. Breaking out close to 52-week highs. Could go up 10-12% from here. Would look for a breakout and buy at a pullback when it tests support.
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