OpenText Corporation

L'entreprise

Enterprise Information Management (EIM): content management, business network/EDI, security & digital investigation, and AI/analytics under the OpenText Aviator brand.

Grew by acquisition (Documentum, Micro Focus, and dozens more); reports in US dollars.

Heavily recurring: cloud subscriptions plus large maintenance/support base give predictable revenue.

In 2025 it divested its Application Modernization & Connectivity (AMC/Micro Focus mainframe) unit to Rocket Software, deliberately shrinking revenue to sharpen focus and cut debt.

Les avantages concurrentiels

Mission-critical, deeply embedded content and data-exchange systems carry very high switching costs.

Large installed base and multi-year maintenance contracts produce durable, high-margin recurring cash flow.

Broad EIM portfolio and business-network reach are hard for point-solution rivals to replicate.

Aperçu financier

Période déclarée la plus récente : FY2025 (ended Jun 30 2025); cash-flow TTM to Mar 31 2026. Les chiffres reflètent la date de révision — confirmez les chiffres actuels avant d'agir.

Rendement du flux de trésorerie disponible et croissance durable

Rendement du flux de trésorerie disponible : ≈12.6%TTM free cash flow US$810M ÷ market cap US$6.41B ≈ 12.6%.

Operating cash flow +14.2% and FCF +14.2% on a TTM basis even as reported revenue fell — a leaner, higher-conversion business post-divestiture.

Capex is light (~3% of revenue); FCF/revenue conversion is strong.

Divestiture proceeds are directed to debt paydown and buybacks, improving per-share cash economics.

Voir le classement complet du rendement du flux de trésorerie disponible →

Valorisation et points à surveiller

FCF yield ~12.6% on TTM free cash flow — very high, reflecting the market's skepticism about the top-line decline.

Trailing P/E ~12.9x is a low-teens multiple for a sticky software franchise.

Analyst consensus is 'Hold' (~US$29 target vs ~US$26 price); the debate is organic growth, not cash generation.

Dividende

Pays US$1.10/share annualized (~US$0.275 quarterly) for a ~4.2% yield; the dividend has been raised over time and is well covered by ~US$810M of free cash flow. A rare software name that pays a real income yield.

Risques et scénario baissier

• Revenue is declining (down ~10% after selling AMC) — the company must prove it can return the remaining base to organic growth.
• Carries meaningful debt from the Micro Focus acquisition; deleveraging is a priority and a constraint.
• Cloud transition and AI (Aviator/Titanium X) execution risk against larger cloud and AI-native competitors.
• Serial-acquisition model means integration and impairment risk can resurface.

Faits récents

Completed the sale of the AMC (Micro Focus mainframe/connectivity) business to Rocket Software, the main driver of the ~10% revenue decline.

Applied proceeds to reduce debt and repurchase shares; continued its dividend.

TTM free cash flow rose to ~US$810M (+14%) as the slimmer portfolio improved conversion.

Pushed its AI layer (OpenText Aviator) and the Titanium X cloud platform across the product line.

Verdict

OpenText is a classic 'melting-ice-cube-or-value' debate: reported revenue is shrinking after deliberate divestitures, yet the remaining business gushes free cash flow, funding a ~4% dividend and buybacks at a ~13% FCF yield. The thesis hinges entirely on whether management can stabilize organic growth and de-lever; if it can, the valuation is cheap, if not, the multiple is justified. CoinCompass publishes analysis, not advice — confirm the latest quarter and judge the growth trajectory yourself.