Open Text Corporation (NASDAQ:OTEX) Receives Average Recommendation of "Hold" from Brokerages

Key Points

• Analysts maintain a “Hold” consensus on Open Text, with 11 holds and three buys among 14 ratings. The average 12-month price target is $32.46, above the reported share price of $24.67.
• Open Text exceeded quarterly expectations, reporting $1.23 in EPS versus the $1.02 estimate and $1.33 billion in revenue, up 2.9% year over year.
• Institutional investors own 70.37% of the company, while Open Text offers an annualized $1.12 dividend, yielding about 4.5%.

Shares of Open Text Corporation (NASDAQ:OTEX - Get Free Report) TSE: OTC have been given a consensus recommendation of "Hold" by the fourteen ratings firms that are presently covering the company, MarketBeat.com reports. Eleven analysts have rated the stock with a hold recommendation and three have given a buy recommendation to the company. The average twelve-month price target among brokers that have issued a report on the stock in the last year is $32.4583.

Several research firms recently commented on OTEX. Citigroup increased their price objective on Open Text from $25.00 to $28.00 and gave the company a "neutral" rating in a research report on Friday, August 7th. National Bank Financial decreased their target price on Open Text from $45.00 to $33.00 and set an "outperform" rating for the company in a research report on Wednesday, May 27th. UBS Group upped their target price on shares of Open Text from $25.00 to $27.00 and gave the company a "neutral" rating in a research note on Friday, August 7th. Scotia reduced their price target on shares of Open Text from $40.00 to $33.00 and set a "sector outperform" rating for the company in a research note on Friday, August 7th. Finally, Weiss Ratings reissued a "hold (c-)" rating on shares of Open Text in a report on Wednesday, June 24th.

Hedge Funds Weigh In On Open Text

Hedge funds and other institutional investors have recently modified their holdings of the company. FIL Ltd grew its holdings in shares of Open Text by 5.7% in the fourth quarter. FIL Ltd now owns 12,155,000 shares of the software maker's stock worth $395,853,000 after acquiring an additional 655,000 shares during the period. The Manufacturers Life Insurance Company bought a new position in Open Text in the second quarter valued at about $266,599,000. First Trust Advisors LP lifted its holdings in Open Text by 27.3% in the fourth quarter. First Trust Advisors LP now owns 11,493,714 shares of the software maker's stock valued at $374,394,000 after acquiring an additional 2,466,264 shares during the period. Royal Bank of Canada boosted its position in Open Text by 10.9% in the first quarter. Royal Bank of Canada now owns 9,843,494 shares of the software maker's stock worth $218,920,000 after purchasing an additional 965,385 shares during the last quarter. Finally, Brandes Investment Partners LP grew its stake in shares of Open Text by 1.2% during the 4th quarter. Brandes Investment Partners LP now owns 9,106,157 shares of the software maker's stock valued at $296,679,000 after purchasing an additional 106,766 shares during the period. 70.37% of the stock is owned by institutional investors.

Open Text Stock Performance

Shares of NASDAQ OTEX opened at $24.67 on Monday. The firm's 50 day moving average price is $23.31 and its 200-day moving average price is $23.34. Open Text has a 52-week low of $19.77 and a 52-week high of $39.90. The company has a debt-to-equity ratio of 1.43, a quick ratio of 0.81 and a current ratio of 0.81. The company has a market cap of $5.97 billion, a PE ratio of 9.56 and a beta of 1.03.

Open Text (NASDAQ:OTEX - Get Free Report) TSE: OTC last posted its earnings results on Thursday, August 6th. The software maker reported $1.23 EPS for the quarter, topping analysts' consensus estimates of $1.02 by $0.21. Open Text had a return on equity of 25.76% and a net margin of 12.26%.The business had revenue of $1.33 billion during the quarter, compared to analyst estimates of $1.29 billion. During the same quarter last year, the company earned $0.97 EPS. The company's quarterly revenue was up 2.9% compared to the same quarter last year. On average, equities research analysts expect that Open Text will post 3.72 EPS for the current fiscal year.

Open Text Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, September 18th. Shareholders of record on Friday, September 4th will be given a $0.28 dividend. This is a boost from Open Text's previous quarterly dividend of $0.28. The ex-dividend date of this dividend is Friday, September 4th. This represents a $1.12 dividend on an annualized basis and a yield of 4.5%. Open Text's payout ratio is presently 42.64%.

About Open Text

Open Text Corporation is a Canadian enterprise information management (EIM) software company that develops solutions for organizations seeking to manage, protect and extract insight from their unstructured and structured data. The company's platform encompasses document management, records management, digital asset management and archiving, enabling companies to govern information across its lifecycle.

Open Text's product suite includes content services, business process management, customer experience management, analytics and security products.

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