The stock of Open Text Corp (NASDAQ: OTEX) has increased by 0.10 when compared to last closing price of 30.22.Despite this, the company has seen a loss of -14.33% in its stock price over the last five trading days. Seeking Alpha reported 2024-05-05 that OpenText is a Canadian company that develops information management software for the enterprise market. Recent performance has been volatile, driven by recent selloffs after Q3 earnings call as Open Text projects lower revenue guidance in FY 2025 due to major divestiture. Nonetheless, Open Text’s strong focus on reducing debt and increasing shareholder returns through buybacks and dividend increase could drive upside.
Is It Worth Investing in Open Text Corp (NASDAQ: OTEX) Right Now?
Open Text Corp (NASDAQ: OTEX) has a price-to-earnings ratio of 49.11x that is above its average ratio. Additionally, the 36-month beta value for OTEX is 1.15. There are mixed opinions on the stock, with 13 analysts rating it as a “buy,” 1 rating it as “overweight,” 2 rating it as “hold,” and 0 rating it as “sell.”
The public float for OTEX is 266.90M and currently, short sellers hold a 1.92% ratio of that float. The average trading volume of OTEX on May 08, 2024 was 685.49K shares.
OTEX’s Market Performance
OTEX’s stock has seen a -14.33% decrease for the week, with a -18.57% drop in the past month and a -26.81% fall in the past quarter. The volatility ratio for the week is 4.40%, and the volatility levels for the past 30 days are at 2.58% for Open Text Corp The simple moving average for the last 20 days is -13.51% for OTEX’s stock, with a simple moving average of -21.20% for the last 200 days.
Analysts’ Opinion of OTEX
Many brokerage firms have already submitted their reports for OTEX stocks, with BMO Capital Markets repeating the rating for OTEX by listing it as a “Market Perform.” The predicted price for OTEX in the upcoming period, according to BMO Capital Markets is $38 based on the research report published on May 03, 2024 of the current year 2024.
Jefferies, on the other hand, stated in their research note that they expect to see OTEX reach a price target of $45. The rating they have provided for OTEX stocks is “Buy” according to the report published on February 27th, 2024.
Barclays gave a rating of “Equal Weight” to OTEX, setting the target price at $41 in the report published on March 22nd of the previous year.
OTEX Trading at -18.56% from the 50-Day Moving Average
After a stumble in the market that brought OTEX to its low price for the period of the last 52 weeks, the company was unable to rebound, for now settling with -33.47% of loss for the given period.
Volatility was left at 2.58%, however, over the last 30 days, the volatility rate increased by 4.40%, as shares sank -18.90% for the moving average over the last 20 days. Over the last 50 days, in opposition, the stock is trading -21.35% lower at present.
During the last 5 trading sessions, OTEX fell by -14.33%, which changed the moving average for the period of 200-days by -27.63% in comparison to the 20-day moving average, which settled at $34.62. In addition, Open Text Corp saw -28.01% in overturn over a single year, with a tendency to cut further losses.
Stock Fundamentals for OTEX
Current profitability levels for the company are sitting at:
- 0.14 for the present operating margin
- 0.7 for the gross margin
The net margin for Open Text Corp stands at 0.03. The total capital return value is set at 0.06. Equity return is now at value 4.08, with 0.99 for asset returns.
Based on Open Text Corp (OTEX), the company’s capital structure generated 0.67 points at debt to capital in total, while cash flow to debt ratio is standing at 0.11. The debt to equity ratio resting at 2.04. The interest coverage ratio of the stock is 1.43.
Currently, EBITDA for the company is 1.35 billion with net debt to EBITDA at 4.16. When we switch over and look at the enterprise to sales, we see a ratio of 2.68. The receivables turnover for the company is 7.98for trailing twelve months and the total asset turnover is 0.36. The liquidity ratio also appears to be rather interesting for investors as it stands at 1.39.
Conclusion
In conclusion, Open Text Corp (OTEX) has seen bad performance in recent times. Analysts have a mixed opinion on the stock, with some rating it as a “buy” and others rating it as a “hold”. It’s important to note that the stock is currently trading at a significant distance from its 50-day moving average and its 52-week high.
