Open Text (NASDAQ:OTEX) Price Target Cut to $35.00 by Analysts at Raymond James Financial

Key Points

• Raymond James cut its price target on Open Text to $35 (from $42) while keeping an "outperform" rating, implying roughly a 43.7% upside from the current share price.
• Consensus among analysts is a "Hold" with an average price target of $34.50; other firms also trimmed targets, leaving a mix of 4 Buys and 10 Holds.
• Open Text beat Q3 EPS and revenue estimates and maintained a quarterly dividend (~4.6% yield) amid significant institutional buying, but reported weaker operating/free cash flow and margin pressure that could temper near‑term upside.

Open Text (NASDAQ:OTEX - Get Free Report) TSE: OTC had its target price lowered by research analysts at Raymond James Financial from $42.00 to $35.00 in a research report issued on Friday,BayStreet.CA reports. The brokerage currently has an "outperform" rating on the software maker's stock. Raymond James Financial's price target indicates a potential upside of 43.70% from the company's current price.

OTEX has been the subject of a number of other research reports. Royal Bank Of Canada decreased their price target on Open Text from $30.00 to $27.00 and set a "sector perform" rating for the company in a research report on Friday. Canadian Imperial Bank of Commerce decreased their price objective on shares of Open Text from $40.00 to $37.00 and set a "neutral" rating for the company in a research note on Friday, January 16th. Citigroup decreased their price objective on Open Text from $26.00 to $25.00 and set a "neutral" rating for the company in a research report on Friday. Scotia decreased their price objective on Open Text from $50.00 to $40.00 and set a "sector outperform" rating for the company in a research report on Friday. Finally, TD Securities raised shares of Open Text to a "hold" rating in a research note on Monday, February 2nd. Four analysts have rated the stock with a Buy rating and ten have given a Hold rating to the company's stock. According to data from MarketBeat, Open Text presently has a consensus rating of "Hold" and an average price target of $34.50.

Open Text Stock Up 2.8%

Open Text stock traded up $0.67 during midday trading on Friday, hitting $24.36. 3,251,427 shares of the stock were exchanged, compared to its average volume of 1,993,040. The company has a debt-to-equity ratio of 1.57, a current ratio of 0.94 and a quick ratio of 0.94. Open Text has a 1 year low of $20.00 and a 1 year high of $39.90. The company has a 50 day moving average price of $23.08 and a two-hundred day moving average price of $28.75. The firm has a market cap of $5.90 billion, a P/E ratio of 14.37 and a beta of 1.04.

Open Text (NASDAQ:OTEX - Get Free Report) TSE: OTC last issued its quarterly earnings data on Thursday, February 5th. The software maker reported $1.13 EPS for the quarter, topping analysts' consensus estimates of $1.04 by $0.09. The firm had revenue of $1.32 billion during the quarter, compared to the consensus estimate of $1.29 billion. Open Text had a return on equity of 23.60% and a net margin of 8.42%.The firm's revenue was down .6% on a year-over-year basis. During the same period in the prior year, the business earned $1.11 EPS. On average, sell-side analysts predict that Open Text will post 3.98 earnings per share for the current fiscal year.

Institutional Trading of Open Text

Hedge funds have recently modified their holdings of the company. Norges Bank acquired a new stake in shares of Open Text in the fourth quarter valued at approximately $106,700,000. First Trust Advisors LP grew its holdings in shares of Open Text by 27.3% in the 4th quarter. First Trust Advisors LP now owns 11,493,714 shares of the software maker's stock valued at $374,394,000 after buying an additional 2,466,264 shares during the period. Connor Clark & Lunn Investment Management Ltd. grew its position in shares of Open Text by 456.0% in the 3rd quarter. Connor Clark & Lunn Investment Management Ltd. now owns 2,312,755 shares of the software maker's stock valued at $86,429,000 after purchasing an additional 1,896,755 shares during the period. Morgan Stanley grew its position in shares of Open Text by 76.8% in the 4th quarter. Morgan Stanley now owns 2,884,381 shares of the software maker's stock valued at $93,973,000 after purchasing an additional 1,253,405 shares during the period. Finally, The Manufacturers Life Insurance Company grew its position in shares of Open Text by 11.7% in the 4th quarter. The Manufacturers Life Insurance Company now owns 10,734,420 shares of the software maker's stock valued at $349,978,000 after purchasing an additional 1,122,320 shares during the period. Institutional investors and hedge funds own 70.37% of the company's stock.

Open Text News Roundup

Here are the key news stories impacting Open Text this week:

• Positive Sentiment: Q3 results showed an earnings beat and revenue growth: Open Text reported roughly $1.28B in revenue (≈+2.2% Y/Y) and EPS above consensus, with net income and EPS rising sharply year-over-year. Investors view the beat as validation of the recovery in profitability. Read More.
• Positive Sentiment: CEO transition finalized: Ayman Antoun officially joined as CEO (effective April 20), which the company and markets framed positively as new leadership to drive strategy and execution. Read More.
• Positive Sentiment: Dividend maintained and investor yield appeal: Open Text declared a quarterly dividend of $0.275 (annualized yield ~4.6%), reinforcing the cash-return profile that supports income-focused holders and can stabilize the share price.
• Positive Sentiment: Institutional activity and analyst targets show buyer interest: Several large managers added to positions recently and median analyst targets sit above the current price, providing potential upside if execution continues. Read More.
• Neutral Sentiment: FY‑2026 revenue guidance roughly in line with Street expectations: Management updated fiscal 2026 revenue guidance to about $5.2B–$5.3B, which essentially confirms consensus and removes a near‑term catalyst for large upgrades.
• Neutral Sentiment: Earnings call materials and transcript available for detail: Management provided the earnings slide deck and call transcript for deeper read-throughs on strategy, cloud growth and margin drivers. Read More. Read More.
• Negative Sentiment: Operating cash flow and free cash flow weakness: Reported operating cash flow declined sharply and capex rose, reducing free-cash-flow generation and limiting immediate capacity for buybacks or M&A—a key concern for valuation and dividend sustainability. Read More.
• Negative Sentiment: Operating profit and some margins slipped Y/Y despite revenue growth, signaling margin pressure that could temper upside until cost structure and cloud mix improve.

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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