31.74 USD
-0.84 (-2.58%)
31.74 USD
0 (0%)
OTEX gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 276 industry peers in the Software industry. OTEX scores excellent on profitability, but there are 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
In the past year OTEX was profitable.
In the past year OTEX had a positive cash flow from operations.
In the past 5 years OTEX has always been profitable.
OTEX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.70%, OTEX is in the better half of the industry, outperforming 68.48% of the companies in the same industry.
OTEX has a Return On Equity of 12.61%. This is in the better half of the industry: OTEX outperforms 76.09% 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 77.17% of its industry peers.
OTEX had an Average Return On Invested Capital over the past 3 years of 6.00%. This 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 has a better Profit Margin (9.60%) than 70.29% of its industry peers.
OTEX's Profit Margin has improved in the last couple of years.
OTEX has a Operating Margin of 20.73%. This is amongst the best in the industry. OTEX outperforms 86.23% of its industry peers.
In the last couple of years the Operating Margin of OTEX has remained more or less at the same level.
With a Gross Margin value of 72.51%, OTEX perfoms like the industry average, outperforming 57.97% of the companies in the same industry.
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so OTEX is destroying value.
Compared to 1 year ago, OTEX has less shares outstanding
OTEX has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, OTEX has a worse debt to assets ratio.
2.2 Solvency
OTEX has an Altman-Z score of 1.32. 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 of 1.32. This is comparable to the rest of the industry: OTEX outperforms 41.30% of its industry peers.
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 has a Debt to FCF ratio of 7.04. This is comparable to the rest of the industry: OTEX outperforms 52.17% 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.
OTEX's Debt to Equity ratio of 1.60 is on the low side compared to the rest of the industry. OTEX is outperformed by 80.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.6 | ||
| Debt/FCF | 7.04 | ||
| Altman-Z | 1.32 |
ROIC/WACC0.76
WACC9.86%
2.3 Liquidity
A Current Ratio of 0.87 indicates that OTEX may have some problems paying its short term obligations.
The Current ratio of OTEX (0.87) is worse than 81.88% of its industry peers.
A Quick Ratio of 0.87 indicates that OTEX may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.87, OTEX is doing worse than 81.52% of the companies in the same industry.
| 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%.
The Earnings Per Share has been growing slightly by 5.79% on average over the past years.
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
Based on estimates for the next years, OTEX will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.33% on average per year.
The Revenue is expected to grow by 4.54% on average over the next years.
EPS Next Y10.02%
EPS Next 2Y9.09%
EPS Next 3Y8.33%
EPS Next 5YN/A
Revenue Next Year1.28%
Revenue Next 2Y1.54%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 8.04, the valuation of OTEX can be described as very reasonable.
OTEX's Price/Earnings ratio is rather cheap when compared to the industry. OTEX is cheaper than 90.58% of the companies in the same industry.
When comparing the Price/Earnings ratio of OTEX to the average of the S&P500 Index (26.60), we can say OTEX is valued rather cheaply.
A Price/Forward Earnings ratio of 6.96 indicates a rather cheap valuation of OTEX.
Based on the Price/Forward Earnings ratio, OTEX is valued cheaper than 93.12% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.23. OTEX is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.04 | ||
| Fwd PE | 6.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, OTEX is valued cheaply inside the industry as 92.03% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of OTEX indicates a rather cheap valuation: OTEX is cheaper than 94.20% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.83 | ||
| EV/EBITDA | 7.75 |
4.3 Compensation for Growth
OTEX's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of OTEX may justify a higher PE ratio.
PEG (NY)0.8
PEG (5Y)1.39
EPS Next 2Y9.09%
EPS Next 3Y8.33%
5. Dividend
5.1 Amount
OTEX has a Yearly Dividend Yield of 3.03%. Purely for dividend investing, there may be better candidates out there.
OTEX's Dividend Yield is rather good when compared to the industry average which is at 0.54. OTEX pays more dividend than 96.38% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 1.94, OTEX pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.03% |
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.
OTEX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP54.34%
EPS Next 2Y9.09%
EPS Next 3Y8.33%
31.74
-0.84 (-2.58%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners82.98%
Inst Owner Change0%
Ins Owners1.48%
Ins Owner ChangeN/A
Market Cap8.00B
Revenue(TTM)5.19B
Net Income(TTM)498.12M
Analysts78
Price Target39.9 (25.71%)
Short Float %4.17%
Short Ratio9.57
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.03% |
Yearly Dividend1.04
Dividend Growth(5Y)8.34%
DP54.34%
Div Incr Years11
Div Non Decr Years11
Ex-DateN/A
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)-10.9%
PT rev (3m)-11.48%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-4.09%
EPS NY rev (1m)0%
EPS NY rev (3m)0.03%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.67%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)-0.38%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.04 | ||
| Fwd PE | 6.96 | ||
| P/S | 1.54 | ||
| P/FCF | 8.83 | ||
| P/OCF | 7.57 | ||
| P/B | 2.02 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.75 |
EPS(TTM)3.95
EY12.44%
EPS(NY)4.56
Fwd EY14.36%
FCF(TTM)3.59
FCFY11.32%
OCF(TTM)4.19
OCFY13.2%
SpS20.58
BVpS15.68
TBVpS-21.2
PEG (NY)0.8
PEG (5Y)1.39
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 | 1.32 |
F-Score6
WACC9.86%
ROIC/WACC0.76
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 Y10.02%
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 Year1.28%
Revenue Next 2Y1.54%
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.
What is the valuation status of OPEN TEXT CORP (OTEX) stock?
ChartMill assigns a valuation rating of 8 / 10 to OPEN TEXT CORP (OTEX). This can be considered as Undervalued.
Can you provide the profitability details for OPEN TEXT CORP?
OPEN TEXT CORP (OTEX) has a profitability rating of 7 / 10.
What are the PE and PB ratios of OPEN TEXT CORP (OTEX) stock?
The Price/Earnings (PE) ratio for OPEN TEXT CORP (OTEX) is 8.04 and the Price/Book (PB) ratio is 2.02.
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%.