Open Text
Market Cap
US$12.5b
Last Updated
2021/05/17 22:23 UTC
Data Sources
Company Financials +
Executive Summary
Open Text Corporation provides a suite of software products and services. More Details
Rewards
Risk Analysis
Snowflake Analysis
Fair value with moderate growth potential.
Similar Companies
Share Price & News
How has Open Text's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: OTEX is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: OTEX's weekly volatility (3%) has been stable over the past year.
Market Performance
7 Day Return
-2.3%
OTEX
0.2%
US Software
-0.6%
US Market
1 Year Return
14.6%
OTEX
36.6%
US Software
46.0%
US Market
Return vs Industry: OTEX underperformed the US Software industry which returned 38.1% over the past year.
Return vs Market: OTEX underperformed the US Market which returned 50.8% over the past year.
Shareholder returns
| OTEX | Industry | Market | |
|---|---|---|---|
| 7 Day | -2.3% | 0.2% | -0.6% |
| 30 Day | -7.9% | -7.1% | -1.8% |
| 90 Day | -2.9% | -7.6% | 0.2% |
| 1 Year | 16.5%14.6% | 37.5%36.6% | 48.4%46.0% |
| 3 Year | 41.5%34.6% | 123.5%117.2% | 60.5%50.4% |
| 5 Year | 78.0%64.1% | 294.8%274.8% | 125.9%100.9% |
Long-Term Price Volatility Vs. Market
How volatile is Open Text's share price compared to the market and industry in the last 5 years?
Simply Wall St News
1 week ago | Simply Wall St
Should You Think About Buying Open Text Corporation (NASDAQ:OTEX) Now?1 month ago | Simply Wall St
Are Investors Undervaluing Open Text Corporation (NASDAQ:OTEX) By 23%?1 month ago | Simply Wall St
Looking For Steady Income For Your Dividend Portfolio? Is Open Text Corporation (NASDAQ:OTEX) A Good Fit?Valuation
Is Open Text undervalued compared to its fair value and its price relative to the market?
44.1%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: OTEX ($45.88) is trading below our estimate of fair value ($82.1)
Significantly Below Fair Value: OTEX is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: OTEX is poor value based on its PE Ratio (80.2x) compared to the US Software industry average (48.7x).
PE vs Market: OTEX is poor value based on its PE Ratio (80.2x) compared to the US market (19.8x).
Price to Earnings Growth Ratio
PEG Ratio: OTEX is poor value based on its PEG Ratio (1.3x)
Price to Book Ratio
PB vs Industry: OTEX is good value based on its PB Ratio (3.1x) compared to the US Software industry average (7.7x).
Future Growth
How is Open Text forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?
62.2%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: OTEX's forecast earnings growth (62.2% per year) is above the savings rate (2%).
Earnings vs Market: OTEX's earnings (62.2% per year) are forecast to grow faster than the US market (14.6% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: OTEX's revenue (1.7% per year) is forecast to grow slower than the US market (9% per year).
High Growth Revenue: OTEX's revenue (1.7% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: Insufficient data to determine if OTEX's Return on Equity is forecast to be high in 3 years time
Past Performance
How has Open Text performed over the past 5 years?
-30.0%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: OTEX has high quality earnings.
Growing Profit Margin: OTEX's current net profit margins (4.7%) are lower than last year (9.2%).
Past Earnings Growth Analysis
Earnings Trend: OTEX's earnings have declined by 30% per year over the past 5 years.
Accelerating Growth: OTEX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: OTEX had negative earnings growth (-44.3%) over the past year, making it difficult to compare to the Software industry average (23.2%).
Return on Equity
High ROE: OTEX's Return on Equity (3.9%) is considered low.
Financial Health
How is Open Text's financial position?
Financial Position Analysis
Short Term Liabilities: OTEX's short term assets ($2.1B) exceed its short term liabilities ($1.3B).
Long Term Liabilities: OTEX's short term assets ($2.1B) do not cover its long term liabilities ($4.2B).
Debt to Equity History and Analysis
Debt Level: OTEX's debt to equity ratio (89%) is considered high.
Reducing Debt: OTEX's debt to equity ratio has increased from 83.1% to 89% over the past 5 years.
Debt Coverage: OTEX's debt is well covered by operating cash flow (24%).
Interest Coverage: OTEX's interest payments on its debt are well covered by EBIT (5.1x coverage).
Balance Sheet
Dividend
What is Open Text current dividend yield, its reliability and sustainability?
1.75%
Current Dividend Yield
Upcoming Dividend Payment
Dividend Yield vs Market
Notable Dividend: OTEX's dividend (1.75%) is higher than the bottom 25% of dividend payers in the US market (1.24%).
High Dividend: OTEX's dividend (1.75%) is low compared to the top 25% of dividend payers in the US market (3.42%).
Stability and Growth of Payments
Stable Dividend: Whilst dividend payments have been stable, OTEX has been paying a dividend for less than 10 years.
Growing Dividend: OTEX's dividend payments have increased, but the company has only paid a dividend for 8 years.
Current Payout to Shareholders
Dividend Coverage: With its high payout ratio (131.2%), OTEX's dividend payments are not well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: OTEX's dividends in 3 years are forecast to be well covered by earnings (27.1% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
3.6yrs
Average management tenure
CEO
Mark Barrenechea (55 yo)
9.33yrs
Tenure
US$9,750,205
Compensation
Mr. Mark J. Barrenechea has been the Chief Executive Officer and President of OpenText Public Sector Solutions, Inc. since January 2, 2012 and has been its Chief Technology Officer since January 4, 2016. M...
CEO Compensation Analysis
Compensation vs Market: Mark's total compensation ($USD9.75M) is about average for companies of similar size in the US market ($USD11.20M).
Compensation vs Earnings: Mark's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
Leadership Team
Experienced Management: OTEX's management team is considered experienced (3.6 years average tenure).
Board Members
Experienced Board: OTEX's board of directors are seasoned and experienced ( 11.9 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: OTEX insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Open Text Corporation's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Open Text Corporation
- Ticker: OTEX
- Exchange: NasdaqGS
- Founded: 1991
- Industry: Application Software
- Sector: Software
- Market Cap: US$12.462b
- Shares outstanding: 271.63m
- Website: https://www.opentext.com
Number of Employees
Location
- Open Text Corporation
- 275 Frank Tompa Drive
- Waterloo
- Ontario
- N2L 0A1
- Canada
Listings
Biography
Open Text Corporation provides a suite of software products and services. The company offers content services; business network that manages and connects data within the organization; Cyber Resilience, a s...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/05/17 22:23 |
| End of Day Share Price | 2021/05/17 00:00 |
| Earnings | 2021/03/31 |
| Annual Earnings | 2020/06/30 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.