Open Text trades at a forward price-to-earnings ratio of 4.9x with a PEG of 0.05, making it attractively valued relative to its earnings beat history and 162% free-cash-flow conversion rate, but a death-cross technical pattern and high implied volatility of 77% keep near-term risk elevated.
Thesis pillars
- Deep Value Fcf Conversion↑Improving
- Earnings Beat Streak→Stable
- Piotroski Quality Signal→Stable
- +1 more pillar — see the Why tab for full reasoning
Pillars as of Jul 3, 2026, based on the 10-K filed Aug 6, 2026· older than 90 days
Open Text Corporation (OTEX) Stock Analysis
Range Bound setup
Technology · Software - Application
Hold if already holding. Not a fresh buy at $26.59, but acceptable to hold if already in. Reasons: Analyst target reached - limited upside remaining; Sector modifier (Technology): -0.8.
OpenText, a Canadian software company incorporated in 1991, sells enterprise data management software in seven categories, led by Content, plus business network, IT operations, cybersecurity, application delivery and analytics products. Revenue comes from cloud services and... Read more
Hold if already holding. Not a fresh buy at $26.59, but acceptable to hold if already in. Reasons: Analyst target reached - limited upside remaining; Sector modifier (Technology): -0.8. Chart setup: RSI 57 mid-range, Bollinger mid-band. Downgraded from BUY WAIT — price $26.59 vs the analyst target $24.32: -8.5% upside; No upside left. Score 5.4/10, moderate confidence.
Passes 5/8 gates (clean insider activity, no SEC red flags, news events none recent, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and earnings proximity 0d<=7d. Suitability: moderate.
About Open Text Corporation
About Open Text Corporation
OpenText groups its data management software into seven product categories, led by Content, and reports four revenue streams: cloud services and subscriptions, customer support, license, and professional service and other. The Canadian company, incorporated in 1991, divested eDOCS on January 12, 2026 and Vertica on May 11, 2026, businesses that comprised approximately 8% and 34% of the Analytics category in fiscal 2026. Cloud services and subscriptions was the largest driver of growth in fiscal 2026.
Cloud services and subscriptions cover software-as-a-service offerings, APIs and data services, and private cloud with managed services. Customer support is typically renewed annually and has historically been a significant portion of total revenue, while license revenue reflects software sales that often involve a significant implementation commitment. The client base spans Global 10,000 organizations, public sector agencies, mid-market companies, small and medium-sized businesses and direct consumers; the small-business cybersecurity portfolio is often sold through a global network of managed service providers. OpenText embeds its content products in SAP infrastructure, deploys on Google Cloud and Amazon Web Services, and is one of Microsoft's nine authorized Cloud Solutions Providers in the North American small-business market. Named competitors include IBM, Microsoft, Oracle and ServiceNow, with Microsoft also acting as a partner in certain markets.
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Platform and partner dependence frames the risk. The 10-K says OpenText depends on third-party cloud infrastructure and platform providers to host and deliver its cloud offerings, and that outages, repricing or discontinued services could impair availability and harm client relationships; its products also rely on infrastructure software such as operating systems, databases and middleware produced by Oracle, Microsoft and others. At the same time, large platform providers including Microsoft and ServiceNow are extending into enterprise AI and agentic workflows, so a partner may become a rival. The shift from perpetual licenses to subscriptions could add pricing pressure and change the timing of revenue recognition, which may weigh on margins if clients adopt cloud offerings more slowly than expected.
See also: Technology · Software - Application
From Open Text Corporation's most recent 10-K filing, extracted October 18, 2026.
Recent developments
updated Nov 3, 2026Recent Developments — Open Text Corporation
Latest news
- NEWS Why Open Text (TSX:OTEX) Is in Focus as Cash Conversion Draws Focus? - Kalkine Media — Kalkine Media Nov 3, 2026 positive
- NEWS Open Text Corp. stock falls Wednesday, underperforms market - MarketWatch — MarketWatch Oct 28, 2026 negative
- NEWS Will Clearer Guidance From OpenText (TSX:OTEX) Ease Lingering Market Doubts? - Kalkine Media — Kalkine Media Oct 28, 2026 neutral
- NEWS Open Text Corporation (TSX:OTEX): Why This TSX Stock Is Drawing Investor Attention and What Comes Next - kalkine.ca — kalkine.ca Oct 28, 2026 neutral
- NEWS Open Text (NasdaqGS:OTEX) Stock Forecast & Analyst Predictions - Simply Wall St — Simply Wall St Oct 28, 2026 neutral
Latest item Nov 3, 2026 · Generated 2026-11-05T11:54:13Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- MEDIUMProductContent product category10-K Item 1: 'OpenText Content is our largest product category'
- MEDIUMSupplierthird-party cloud infrastructure and platform providers10-K Item 1A: 'we depend on third-party cloud infrastructure and platform providers to host and deliver our cloud offerings'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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Rating Breakdown
2 floor-breakers
Growth below the gate floor. Component breakdown shows what dragged the score down.static
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Hold if already holding. Not a fresh buy at $26.59, but acceptable to hold if already in. Reasons: Analyst target reached - limited upside remaining; Sector modifier (Technology): -0.8. Chart setup: RSI 57 mid-range, Bollinger mid-band. Downgraded from BUY WAIT — price $26.59 vs the analyst target $24.32: -8.5% upside; No upside left. Analyst target $24.32 reached (−8.5%), stop $22.72 (−17.0%), A.R:R -0.6:1. Score 5.4/10, moderate confidence.
Analyst target $24.32 reached (−8.5% from $26.59); no take-profit level is published. Analyst target $24.32 reached (−8.5%), stop $22.72 (−17.0%), A.R:R -0.6:1. Stop-loss: $22.72.
Analyst target reached - limited upside remaining; Sector modifier (Technology): -0.8; Leverage penalty (D/E 1.5): -0.5.
Open Text Corporation trades at a P/E of 10.3 (forward 6.2). TrendMatrix value score: 8.2/10. Verdict: Hold.
9 analysts rate OTEX, with a consensus score of 3.9/5. 11 analysts publish price targets averaging $28.
What does Open Text Corporation do?OpenText, a Canadian software company incorporated in 1991, sells enterprise data management software in seven...
OpenText, a Canadian software company incorporated in 1991, sells enterprise data management software in seven categories, led by Content, plus business network, IT operations, cybersecurity, application delivery and analytics products. Revenue comes from cloud services and subscriptions, annual customer support, licenses, and professional services, sold to Global 10,000 enterprises, governments and small businesses via managed service providers. It divested Vertica and eDOCS in 2026.