33.34 USD
-0.01 (-0.03%)
33.34 USD
0 (0%)
Taking everything into account, OTEX scores 5 out of 10 in our fundamental rating. OTEX was compared to 278 industry peers in the Software industry. While OTEX has a great profitability rating, there are quite some concerns on its financial health. OTEX may be a bit undervalued, certainly considering the very reasonable score on growth OTEX also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
OTEX had positive earnings in the past year.
In the past year OTEX had a positive cash flow from operations.
In the past 5 years OTEX has always been profitable.
Each year in the past 5 years OTEX had a positive operating cash flow.
1.2 Ratios
OTEX has a Return On Assets of 3.70%. This is in the better half of the industry: OTEX outperforms 69.06% of its industry peers.
The Return On Equity of OTEX (12.61%) is better than 76.98% of its industry peers.
OTEX has a Return On Invested Capital of 7.53%. This is in the better half of the industry: OTEX outperforms 76.98% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for OTEX is below the industry average of 10.78%.
The last Return On Invested Capital (7.53%) for OTEX is above the 3 year average (6.00%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 12.61% | ||
| ROIC | 7.53% |
ROA(3y)2.44%
ROA(5y)2.89%
ROE(3y)8.64%
ROE(5y)8.67%
ROIC(3y)6%
ROIC(5y)6.21%
1.3 Margins
OTEX's Profit Margin of 9.60% is fine compared to the rest of the industry. OTEX outperforms 71.22% of its industry peers.
In the last couple of years the Profit Margin of OTEX has grown nicely.
OTEX has a Operating Margin of 20.73%. This is amongst the best in the industry. OTEX outperforms 86.33% of its industry peers.
In the last couple of years the Operating Margin of OTEX has remained more or less at the same level.
OTEX has a Gross Margin of 72.51%. This is comparable to the rest of the industry: OTEX outperforms 57.91% of its industry peers.
In the last couple of years the Gross Margin of OTEX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.73% | ||
| PM (TTM) | 9.6% | ||
| GM | 72.51% |
OM growth 3Y0.5%
OM growth 5Y0.68%
PM growth 3Y-9.47%
PM growth 5Y2.29%
GM growth 3Y1.26%
GM growth 5Y1.3%
2. Health
2.1 Basic Checks
OTEX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, OTEX has less shares outstanding
Compared to 5 years ago, OTEX has less shares outstanding
Compared to 1 year ago, OTEX has a worse debt to assets ratio.
2.2 Solvency
OTEX has an Altman-Z score of 1.35. This is a bad value and indicates that OTEX is not financially healthy and even has some risk of bankruptcy.
OTEX has a Altman-Z score (1.35) which is comparable to the rest of the industry.
The Debt to FCF ratio of OTEX is 7.04, which is on the high side as it means it would take OTEX, 7.04 years of fcf income to pay off all of its debts.
OTEX's Debt to FCF ratio of 7.04 is in line compared to the rest of the industry. OTEX outperforms 52.52% of its industry peers.
OTEX has a Debt/Equity ratio of 1.60. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.60, OTEX is doing worse than 80.94% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.6 | ||
| Debt/FCF | 7.04 | ||
| Altman-Z | 1.35 |
ROIC/WACC0.77
WACC9.83%
2.3 Liquidity
A Current Ratio of 0.87 indicates that OTEX may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.87, OTEX is doing worse than 82.01% of the companies in the same industry.
OTEX has a Quick Ratio of 0.87. This is a bad value and indicates that OTEX is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of OTEX (0.87) is worse than 81.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
OTEX shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.42%.
OTEX shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.79% yearly.
OTEX shows a decrease in Revenue. In the last year, the revenue decreased by -7.58%.
OTEX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.69% yearly.
EPS 1Y (TTM)-3.42%
EPS 3Y5.95%
EPS 5Y5.79%
EPS Q2Q%12.9%
Revenue 1Y (TTM)-7.58%
Revenue growth 3Y13.94%
Revenue growth 5Y10.69%
Sales Q2Q%1.51%
3.2 Future
The Earnings Per Share is expected to grow by 8.33% on average over the next years. This is quite good.
The Revenue is expected to grow by 4.54% on average over the next years.
EPS Next Y10.03%
EPS Next 2Y9.09%
EPS Next 3Y8.33%
EPS Next 5YN/A
Revenue Next Year1.18%
Revenue Next 2Y1.47%
Revenue Next 3Y1.48%
Revenue Next 5Y4.54%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 8.44, the valuation of OTEX can be described as reasonable.
90.29% of the companies in the same industry are more expensive than OTEX, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of OTEX to the average of the S&P500 Index (26.59), we can say OTEX is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 7.31, the valuation of OTEX can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of OTEX indicates a rather cheap valuation: OTEX is cheaper than 92.45% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.03, OTEX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.44 | ||
| Fwd PE | 7.31 |
4.2 Price Multiples
OTEX's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. OTEX is cheaper than 92.45% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of OTEX indicates a rather cheap valuation: OTEX is cheaper than 94.24% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.28 | ||
| EV/EBITDA | 7.98 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
OTEX has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.84
PEG (5Y)1.46
EPS Next 2Y9.09%
EPS Next 3Y8.33%
5. Dividend
5.1 Amount
OTEX has a Yearly Dividend Yield of 2.93%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 0.52, OTEX pays a better dividend. On top of this OTEX pays more dividend than 96.40% of the companies listed in the same industry.
OTEX's Dividend Yield is rather good when compared to the S&P500 average which is at 1.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.93% |
5.2 History
The dividend of OTEX is nicely growing with an annual growth rate of 8.34%!
OTEX has been paying a dividend for at least 10 years, so it has a reliable track record.
OTEX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.34%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
54.34% of the earnings are spent on dividend by OTEX. This is a bit on the high side, but may be sustainable.
The dividend of OTEX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP54.34%
EPS Next 2Y9.09%
EPS Next 3Y8.33%
33.34
-0.01 (-0.03%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners80.71%
Inst Owner Change6.33%
Ins Owners2.08%
Ins Owner ChangeN/A
Market Cap8.40B
Revenue(TTM)5.19B
Net Income(TTM)498.12M
Analysts78
Price TargetN/A
Short Float %4.18%
Short Ratio9.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.93% |
Yearly Dividend1.04
Dividend Growth(5Y)8.34%
DP54.34%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.93%
Min EPS beat(2)4.13%
Max EPS beat(2)15.74%
EPS beat(4)4
Avg EPS beat(4)11.61%
Min EPS beat(4)4.13%
Max EPS beat(4)17.92%
EPS beat(8)6
Avg EPS beat(8)6.82%
EPS beat(12)10
Avg EPS beat(12)10.63%
EPS beat(16)12
Avg EPS beat(16)8.08%
Revenue beat(2)0
Avg Revenue beat(2)-0.66%
Min Revenue beat(2)-0.91%
Max Revenue beat(2)-0.42%
Revenue beat(4)0
Avg Revenue beat(4)-1.5%
Min Revenue beat(4)-4.03%
Max Revenue beat(4)-0.42%
Revenue beat(8)1
Avg Revenue beat(8)-1.88%
Revenue beat(12)3
Avg Revenue beat(12)-1.07%
Revenue beat(16)3
Avg Revenue beat(16)-1.18%
PT rev (1m)-11.9%
PT rev (3m)-2.85%
EPS NQ rev (1m)0.19%
EPS NQ rev (3m)-4.81%
EPS NY rev (1m)0.24%
EPS NY rev (3m)-0.17%
Revenue NQ rev (1m)-0.08%
Revenue NQ rev (3m)-3.6%
Revenue NY rev (1m)-0.43%
Revenue NY rev (3m)-0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.44 | ||
| Fwd PE | 7.31 | ||
| P/S | 1.62 | ||
| P/FCF | 9.28 | ||
| P/OCF | 7.96 | ||
| P/B | 2.13 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.98 |
EPS(TTM)3.95
EY11.85%
EPS(NY)4.56
Fwd EY13.67%
FCF(TTM)3.59
FCFY10.78%
OCF(TTM)4.19
OCFY12.57%
SpS20.58
BVpS15.68
TBVpS-21.2
PEG (NY)0.84
PEG (5Y)1.46
Graham Number37.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 12.61% | ||
| ROCE | 9.76% | ||
| ROIC | 7.53% | ||
| ROICexc | 8.36% | ||
| ROICexgc | 131.42% | ||
| OM | 20.73% | ||
| PM (TTM) | 9.6% | ||
| GM | 72.51% | ||
| FCFM | 17.46% |
ROA(3y)2.44%
ROA(5y)2.89%
ROE(3y)8.64%
ROE(5y)8.67%
ROIC(3y)6%
ROIC(5y)6.21%
ROICexc(3y)6.7%
ROICexc(5y)7.26%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)7.77%
ROCE(5y)8.05%
ROICexgc growth 3Y40.72%
ROICexgc growth 5Y10.07%
ROICexc growth 3Y2.2%
ROICexc growth 5Y2.95%
OM growth 3Y0.5%
OM growth 5Y0.68%
PM growth 3Y-9.47%
PM growth 5Y2.29%
GM growth 3Y1.26%
GM growth 5Y1.3%
F-Score6
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.6 | ||
| Debt/FCF | 7.04 | ||
| Debt/EBITDA | 3.7 | ||
| Cap/Depr | 23.51% | ||
| Cap/Sales | 2.9% | ||
| Interest Coverage | 3.06 | ||
| Cash Conversion | 61.57% | ||
| Profit Quality | 181.84% | ||
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 1.35 |
F-Score6
WACC9.83%
ROIC/WACC0.77
Cap/Depr(3y)20.3%
Cap/Depr(5y)18.32%
Cap/Sales(3y)2.76%
Cap/Sales(5y)2.57%
Profit Quality(3y)255.78%
Profit Quality(5y)250.53%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.42%
EPS 3Y5.95%
EPS 5Y5.79%
EPS Q2Q%12.9%
EPS Next Y10.03%
EPS Next 2Y9.09%
EPS Next 3Y8.33%
EPS Next 5YN/A
Revenue 1Y (TTM)-7.58%
Revenue growth 3Y13.94%
Revenue growth 5Y10.69%
Sales Q2Q%1.51%
Revenue Next Year1.18%
Revenue Next 2Y1.47%
Revenue Next 3Y1.48%
Revenue Next 5Y4.54%
EBIT growth 1Y2.5%
EBIT growth 3Y14.51%
EBIT growth 5Y11.45%
EBIT Next Year14.34%
EBIT Next 3Y7.75%
EBIT Next 5YN/A
FCF growth 1Y59.09%
FCF growth 3Y-8.21%
FCF growth 5Y-4.86%
OCF growth 1Y52.11%
OCF growth 3Y-5.42%
OCF growth 5Y-2.74%
OPEN TEXT CORP / OTEX FAQ
What is the ChartMill fundamental rating of OPEN TEXT CORP (OTEX) stock?
ChartMill assigns a fundamental rating of 5 / 10 to OTEX.
Can you provide the valuation status for OPEN TEXT CORP?
ChartMill assigns a valuation rating of 8 / 10 to OPEN TEXT CORP (OTEX). This can be considered as Undervalued.
What is the profitability of OTEX stock?
OPEN TEXT CORP (OTEX) has a profitability rating of 7 / 10.
What is the expected EPS growth for OPEN TEXT CORP (OTEX) stock?
The Earnings per Share (EPS) of OPEN TEXT CORP (OTEX) is expected to grow by 10.03% in the next year.
Is the dividend of OPEN TEXT CORP sustainable?
The dividend rating of OPEN TEXT CORP (OTEX) is 7 / 10 and the dividend payout ratio is 54.34%.