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→Stable
- Earnings Beat Streak↓Deteriorating
- Piotroski Quality Signal↑Improving
- +1 more pillar — see the Why tab for full reasoning
Open Text Corporation (OTEX) Stock Analysis
Range Bound setup
Technology · Software - Application
Sell if holding. Analyst target reached at $24.54 — A.R:R is negative (-0.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Leverage penalty (D/E 1.5): -0.5.
OpenText is an Information Management company selling software and services across six business clouds — Content, Cybersecurity, Business Network, DevOps, Observability and Service Management, and Analytics — to Global 10,000 enterprises, SMBs, governments, and consumers.... Read more
Sell if holding. Analyst target reached at $24.54 — A.R:R is negative (-0.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Leverage penalty (D/E 1.5): -0.5. Chart setup: RSI 56 mid-range, Bollinger mid-band. Score 5.3/10, moderate confidence.
Passes 5/9 gates (clean insider activity, news events none recent, earnings proximity 82d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and death cross (50MA < 200MA). Suitability: moderate.
About Open Text Corporation
About Open Text Corporation
OpenText's Content Cloud generated 40% of total revenue in fiscal 2025, followed by Cybersecurity Cloud at 25%, with Business Network Cloud, DevOps Cloud, and Observability and Service Management Cloud each contributing 10% and Analytics Cloud the remaining 5%. The company serves Global 10,000 (G10K) enterprises, SMBs, governments, and consumers, and completed its $6.2 billion acquisition of Micro Focus in January 2023 before divesting its Application Modernization and Connectivity business to Rocket Software for $2.275 billion in May 2024.
OpenText earns revenue from subscription and cloud services, customer support, and license fees for its six business clouds — Content, Cybersecurity, Business Network, DevOps, Observability and Service Management, and Analytics — deployed across private cloud, public cloud, off-cloud, and API models. Within cloud services and subscription revenue specifically, Business Network Cloud and Cybersecurity Cloud each contribute 30% and Content Cloud 25%, a different mix than the company's total revenue split. OpenText delivers its cloud offerings through partnerships with Google Cloud Platform, Amazon Web Services, and Microsoft Azure, and integrates with third-party systems including SAP S/4HANA, Salesforce, and Microsoft Office 365. Growth strategy centers on cross-selling newly acquired or developed technologies into its existing G10K customer base, deepening strategic partnerships with SAP, Google Cloud, AWS, Microsoft, Oracle, and Salesforce, and pursuing further acquisitions to complement its Information Management portfolio.
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OpenText's competitive position rests heavily on intellectual property protections that the 10-K acknowledges are imperfect: the company states it is highly dependent on its ability to protect proprietary technology through copyright, patent, trademark, and trade secret law, yet notes that enforcement is particularly difficult in countries outside North America where it markets its software, and that some license arrangements have required disclosing portions of source code or placing it in escrow for a counterparty's protection. The filing also flags open source software embedded in or linked to its products as a distinct exposure, since open source licensors typically provide no warranties or indemnification against infringement claims, a risk that sits alongside — but is legally and commercially separate from — OpenText's exposure to software piracy.
See also: Technology · Software - Application
From Open Text Corporation's most recent 10-K filing, extracted August 9, 2026.
Recent developments
updated 2026-08-15Recent Developments — Open Text Corporation
Latest news
- NEWS Open Text Corp. stock rises Wednesday, outperforms market - MarketWatch — MarketWatch positive
- NEWS Open Text Corp. stock rises Wednesday, outperforms market - marketwatch.com — marketwatch.com positive
- NEWS Guardian Partners Inc. Cuts Stock Position in Open Text Corporation $OTEX - MarketBeat — MarketBeat neutral
- NEWS Open Text Corp (OTEX) Institutional Confidence - TradingKey — TradingKey neutral
- NEWS Open Text Corp. stock outperforms market despite losses on the day - MarketWatch — MarketWatch positive
Generated 2026-08-15T09:37:17Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- MEDIUMProductContent Cloud40%10-K Item 1: 'total revenues is comprised of 40% from Content Cloud, 25% from Cybersecurity Cloud, 10% from Business Network Cloud, 10% from DevOps Cloud, 10% from Observability and Service Management Cloud, and 5% from Analytics Cloud'
Material Events(8-K, last 90d)
- 2026-04-20Item 5.02HIGHInterim CEO James McGourlay transitioned to President, Chief Client Officer effective April 20, 2026; no new CEO named in this filing. Separately, President/Chief Customer Officer Paul Duggan is stepping down, remaining as EVP Special Advisor until departure on July 1, 2026.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
3 floor-breakers
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Growth below the gate floor. Component breakdown shows what dragged the score down.static
Technicals 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
Sell if holding. Analyst target reached at $24.54 — A.R:R is negative (-0.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Leverage penalty (D/E 1.5): -0.5. Chart setup: RSI 56 mid-range, Bollinger mid-band. Prior stop was $22.82. Score 5.3/10, moderate confidence.
Take-profit target: $26.29 (-0.9% upside). Prior stop was $22.82. Stop-loss: $22.82.
Analyst target reached - limited upside remaining; Leverage penalty (D/E 1.5): -0.5; Weak growth.
Open Text Corporation trades at a P/E of 9.3 (forward 5.8). TrendMatrix value score: 8.3/10. Verdict: Sell.
9 analysts cover OTEX with a consensus score of 4.0/5. Average price target: $28.
What does Open Text Corporation do?OpenText is an Information Management company selling software and services across six business clouds — Content,...
OpenText is an Information Management company selling software and services across six business clouds — Content, Cybersecurity, Business Network, DevOps, Observability and Service Management, and Analytics — to Global 10,000 enterprises, SMBs, governments, and consumers. Content Cloud generated 40% of fiscal 2025 revenue and Cybersecurity Cloud 25%. The company completed a $6.2 billion acquisition of Micro Focus in January 2023 and divested its Application Modernization and Connectivity business for $2.275 billion in May 2024.