Open Text OTEX
CanadaTechnology · Software - ApplicationUSD
27.95 USD (+20.8%)
11 analysts
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Open Text Corporation is a Canadian enterprise software company that offers information management, content, and digital experience platforms (such as OpenText Content Cloud) to large corporations, with a business model based on licenses, subscriptions, and cloud services.
Key points
from its scores- ✓Attractive valuation8.8
- ✓Attractive dividend8.6
- ✓High-quality business7.5
- ✕Poor share-price trend1.4
- ✕Fragile balance sheet4.5
AI analysis
bottom line, main risk, context and newsHold, given the strong valuation discount and business quality, but wait for momentum to improve and debt to be reduced before increasing the position.
Open Text trades at a very attractive valuation (P/E 8.97, FCF yield 24.32%) and shows solid quality (gross margin 77.06%), although its revenue growth is moderate (2.90%) and its debt is high (Net Debt/EBITDA 3.07), which, along with very negative momentum (-37.71%), suggests caution despite good fundamentals.
The main risk is the high leverage (Net Debt/EBITDA of 3.07) in a rising interest rate environment, which could pressure the balance sheet and limit the ability to invest or return capital to shareholders.
Context and risks
Open Text has no recent relevant news. Its enterprise software business is not exposed to commodities or shipping routes, and its debt, although high (Net Debt/EBITDA 3.07), is mostly in dollars, so the Fed's rate hike is a factor to watch but not an immediate material risk to its operations.
Is Open Text stock cheap or expensive?
at the analysis dateOn P/E and EV / EBITDA, it trades 70% below the Technology median on average.
| Multiple | Company | Sector | Difference |
|---|---|---|---|
| P/E | 9.0 | 31.3 | −71% |
| EV / EBITDA | 6.4 | 20.4 | −68% |
| Price / book | 1.4 | 6.3 | −78% |
| Price / sales | 1.1 | 5.3 | −80% |
Sector: median of the 283 Technology companies analysed. In bold, the multiples used for the comparison.
Valuation score: 8.8 out of 10 (median for Technology: 5.3).
Average analyst target: 27.95 USD, +20.8% versus the price.
A discount may reflect more risk or slower growth than its sector: Financial health 4.5 (sector 6.9), Growth 7.5 (sector 7.5).
Classic formulas with standard assumptions (10.0% growth, 8-9% discount rate). Indicative only: they change a lot with the assumptions and are not a recommendation.
Work out its fair value yourself →How much would you have made investing every month? →
Comparing it with its sector does not say whether it is a good buy: this is not investment advice.
Score by category
0 to 10 · hover overtap each one to see what it measuresKey metrics
at the analysis date · compared with the Technology medianValuation
- P/E
- 9.0
- Forward P/E
- 5.4
- EV / EBITDA
- 6.4
- Price / book
- 1.4
- Price / sales
- 1.1
- PEG
- 1.02
- Market cap
- 5.6B USD
- Enterprise value
- 10.5B USD
Profitability
- ROE
- 16.2%
- ROA
- 5.6%
- ROIC (approx.)
- 12.5%
- Gross margin
- 77.1%
- Operating margin
- 24.1%
- Net margin
- 12.3%
- Free cash flow
- 1.4B USD
- FCF yield
- 24.3%
- Cash conversion
- 83%
Solvency
- Total debt
- 6.0B USD
- Net debt
- 5.0B USD
- Cash
- 960.8M USD
- EBITDA
- 1.6B USD
- Net debt / EBITDA
- 3.07
- Debt / equity
- 148.72
- Current ratio
- 0.81
- Quick ratio
- 0.72
Growth
- Revenue growth
- +2.9%
- Earnings growth
- +476.1%
- EPS (TTM)
- 2.58 USD
- EPS (forward)
- 4.26 USD
Dividend
- Dividend yield
- 4.8%
- Payout
- 42.6%
Risk and market
- Beta
- 1.02
- Analyst consensus
- Hold (11)
- Target price
- 27.95 USD
- 52-week range
- 19.78 – 39.90
Recent news
All OTEX news →Compare it with its sector
All 283 in Technology →Frequently asked questions about Open Text
Is Open Text stock cheap or expensive?
On P/E and EV / EBITDA, it trades 70% below the Technology median on average. Valuation score: 8.8 out of 10 (median for Technology: 5.3). Average analyst target: 27.95 USD, +20.8% versus the price. This is not investment advice.
What score does Open Text get on MeridIAn Screener?
It scores 6.8 out of 10, rank 339 of 2,130 (better than 83% of the companies analysed). Its strongest category is Valuation (8.8) and its weakest, Momentum (1.4). Analysis of 08/10/2026.
What is Open Text's P/E ratio?
Its P/E is 9.0: the share price equals 9.0 times earnings per share over the last 12 months. The Technology median is 31.3. Based on the earnings analysts expect, the forward P/E is 5.4.
How much is Open Text worth on the stock market?
Its market capitalisation is 5.6B USD and its enterprise value, debt included, is 10.5B USD.
How much debt does Open Text have?
Its net debt (debt minus cash) is 5.0B USD. That is 3.07 times its EBITDA; the Technology median is 0.20.
Does Open Text pay a dividend?
Yes: its dividend yield is 4.84% and it pays out 43% of its earnings.
How has Open Text stock performed over the last year?
It has fallen 37.5% over the last year, excluding dividends. Over the last 52 weeks it has traded between 19.78 and 39.90 USD. Past performance does not guarantee future results.
What do analysts think of Open Text?
11 analysts cover it; their average recommendation is “Hold” and their average target is 27.95 USD (+20.8% versus the price). It is an estimate, not market data.