Open Text (NASDAQ:OTEX) Shares Gap Down on Analyst Downgrade

Open Text Co. (NASDAQ:OTEX) (TSE:OTC) shares gapped down prior to trading on Friday after StockNews.com downgraded the stock from a buy rating to a hold rating. The stock had previously closed at $35.47, but opened at $30.44. Open Text shares last traded at $29.86, with a volume of 1,249,416 shares changing hands.

A number of other brokerages have also commented on OTEX. Citigroup cut their price target on Open Text from $42.00 to $37.00 and set a “neutral” rating on the stock in a research note on Friday. BMO Capital Markets downgraded shares of Open Text from an “outperform” rating to a “market perform” rating and cut their target price for the stock from $50.00 to $38.00 in a research report on Friday. National Bankshares decreased their price target on shares of Open Text from $60.00 to $50.00 and set an “outperform” rating for the company in a research report on Friday. CIBC cut their price target on shares of Open Text from $44.00 to $38.50 and set a “neutral” rating on the stock in a report on Friday. Finally, Royal Bank of Canada reissued an “outperform” rating and issued a $53.00 price objective on shares of Open Text in a research note on Friday, February 2nd. Six analysts have rated the stock with a hold rating and five have issued a buy rating to the company. According to data from MarketBeat.com, the stock has an average rating of “Hold” and an average price target of $42.25.

Institutional Investors Weigh In On Open Text

A number of hedge funds have recently added to or reduced their stakes in OTEX. Optiver Holding B.V. acquired a new stake in shares of Open Text during the 4th quarter worth approximately $27,000. Pacifica Partners Inc. acquired a new stake in Open Text in the fourth quarter worth $32,000. Allworth Financial LP increased its stake in Open Text by 125.7% in the third quarter. Allworth Financial LP now owns 957 shares of the software maker’s stock valued at $34,000 after purchasing an additional 533 shares in the last quarter. Assetmark Inc. acquired a new position in shares of Open Text during the fourth quarter valued at about $48,000. Finally, EverSource Wealth Advisors LLC boosted its position in shares of Open Text by 18.0% during the 4th quarter. EverSource Wealth Advisors LLC now owns 2,186 shares of the software maker’s stock worth $92,000 after purchasing an additional 334 shares in the last quarter. 70.37% of the stock is currently owned by institutional investors.

Open Text Stock Performance

The company has a 50 day moving average price of $37.32 and a 200 day moving average price of $38.73. The company has a debt-to-equity ratio of 2.10, a quick ratio of 1.38 and a current ratio of 1.38. The company has a market capitalization of $8.25 billion, a price-to-earnings ratio of 48.79 and a beta of 1.11.

Open Text (NASDAQ:OTEX) (TSE:OTC) last announced its quarterly earnings data on Thursday, February 1st. The software maker reported $1.11 EPS for the quarter, beating analysts’ consensus estimates of $1.10 by $0.01. Open Text had a return on equity of 24.61% and a net margin of 2.85%. The firm had revenue of $1.53 billion during the quarter, compared to analysts’ expectations of $1.48 billion. Equities research analysts predict that Open Text Co. will post 4.14 earnings per share for the current fiscal year.

Open Text Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Tuesday, June 18th. Investors of record on Friday, May 31st will be given a $0.435 dividend. The ex-dividend date is Friday, May 31st. This represents a $1.74 annualized dividend and a yield of 5.75%. This is an increase from Open Text’s previous quarterly dividend of $0.25. Open Text’s dividend payout ratio (DPR) is presently 161.29%.

Open Text Company Profile

Open Text Corporation provides information management software and solutions. The company offers content services, which includes content collaboration and intelligent capture to records management, collaboration, e-signatures, and archiving; and operates experience cloud platform that provides customer experience and web content management, digital asset management, customer analytics, AI and insights, e-discovery, digital fax, omnichannel communications, secure messaging, and voice of customer, as well as customer journey, testing, and segmentation.