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OTEX · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is Open Text Corp (OTEX) stock moving?
Open Text's Q1 FY2027 report on Nov 5 was mixed. Adjusted EPS of $1.05 beat the $0.92 estimate, but sales of $1.237B missed the $1.241B estimate by a small margin. The bigger concern for the stock is the Q2 sales guide of $1.260B-$1.290B, which sits below the $1.298B consensus, while FY2027 sales guidance of $5.135B-$5.185B was affirmed with its midpoint near the $5.157B estimate. Barclays kept its Equal-Weight rating on Nov 6 and raised its price target to $29, which implies roughly 18% upside from the Nov 10 close. Balance-sheet news is supportive: on Oct 1 the revolver maturity was extended from Dec 19, 2028 to Oct 1, 2031, and a Sep 30 tender offer targeted up to $300M of 3.875% notes due 2028. Price action is weak. The stock closed at $24.56 on Nov 10, down about 12% from $27.94 on Oct 22. It fell 4.9% on Nov 6 on 2.12M shares, the highest volume in the window, and Nov 10 traded to a $24.04 low, the lowest in the 30-day data. Volume has been above 1.8M on most down days since Nov 3, which points to heavier selling pressure. Recent news is neutral to slightly negative on near-term numbers, with the balance sheet and FY guidance as offsets.
News behind the analysis
- Barclays Maintains Equal-Weight on Open Text, Raises Price Target to $29Barclays kept its Equal-Weight rating on Open Text and raised its price target to $29. That target sits about 18% above the Nov 10 close of $24.56.
- OpenText Reports First Quarter Fiscal Year 2027 Financial ResultsOpenText reported Q1 FY2027 results for the quarter ended Sep 30, 2026, citing core revenue growth and a 13% net income margin.
- Open Text Affirms FY2027 Sales Guidance of $5.135B-$5.185B vs $5.157B EstOpen Text kept its FY2027 sales guidance at $5.135B-$5.185B, with the midpoint close to the $5.157B consensus estimate.
- Open Text Sees Q2 Sales $1.260B-$1.290B vs $1.298B EstOpen Text guided Q2 sales to $1.260B-$1.290B, below the $1.298B consensus estimate.
- Open Text Q1 Adj. EPS $1.05 Beats $0.92 Estimate, Sales $1.237B Miss $1.241B EstimateQ1 adjusted EPS of $1.05 beat the $0.92 estimate, but sales of $1.237B fell just short of the $1.241B estimate.
About Open Text Corp
OpenText is a Canadian enterprise software company, based in Waterloo, Ontario, and listed on both Nasdaq and the TSX. It sells software that helps large organisations manage their information, including content management, cybersecurity, business-to-business data exchange and IT operations tools. It grew mainly by buying other companies, such as Micro Focus, and it now pitches itself as a data-management provider for enterprise AI.
How it makes money
Most of OpenText's revenue repeats from year to year. The biggest sources are customer support and maintenance fees on software customers already own, plus cloud services and subscriptions, which brought in roughly $1.96 billion in fiscal 2026 (about 37% of the total). The rest comes from new software licences and professional services. Total revenue for fiscal 2026 (the year ended June 2026) was about $5.2 billion. The company also pays a dividend and buys back shares.
What usually moves OTEX
- Cloud and recurring revenue growth versus stagnant legacy licences
- Debt reduction and leverage after large acquisitions
- Divestitures and portfolio reshaping under new CEO Ayman Antoun
- Enterprise IT and AI-related software spending
- Capital returns via dividends and buybacks