Open Text Corp

Open Text reported fiscal 2026 fourth-quarter total revenue of $1.35 billion, up 2.9% year over year, with non-GAAP diluted EPS of $1.23, a 26.8% increase. Core portfolio revenue reached $1.05 billion, growing 5.3%, while core cloud revenue rose 10.7% to $341 million, and the company closed 64 cloud deals over $1 million, up 49%. For fiscal 2027, Open Text guided total revenue of $5.135 billion to $5.185 billion, a reported decline of 2% to 1% but flat to up 1% in constant currency, with core revenue growth of 2% to 3% and core cloud growth of 8% to 10%. The company plans to add more than 300 quota-carrying sales staff and invest $100 million to $200 million in growth initiatives, while adjusted EBITDA margin is expected to be 32% to 33%. Open Text also reduced debt by $459 million in the quarter, bringing net leverage to 2.75x, and repurchased 14.8 million shares in fiscal 2026.

Four mid-cap companies—OpenText, Brink's, Genpact, and DXC Technology—check every box for a leveraged buyout, according to an analysis by 24/7 Wall St. OpenText, trading at a forward P/E of 5x with 82% recurring revenue and a new CEO conducting a strategic review, is seen as the cleanest LBO setup. Brink's generates $436.4 million in free cash flow and trades at an EV/EBITDA of 9x, with insiders accumulating shares. Genpact, a BPO firm with private-equity roots, trades at a trailing P/E of 9x and saw its Advanced Technology Solutions segment grow 24.3% in the first quarter. DXC Technology, the deepest value name, has a market cap of roughly $1.6 billion against operating cash flow of $1.036 billion and an EV/EBITDA of 2.4x. Historically, private-equity buyouts have delivered a 20% to 40% cash premium to shareholders.

OpenText has appointed Jill Larsen to its board of directors, effective immediately. Larsen currently serves as Chief People Officer at Synopsys, where she focuses on organizational strategy and talent planning for a global workforce of over 25,000 employees. She brings extensive experience from prior C-suite human resources roles at companies including PTC, Medidata, Cisco Systems, EMC, and SunGard. Concurrently, the company announced that Kristen Ludgate has resigned from the board for personal reasons, with no disagreement on operations, policies, or practices. OpenText CEO Ayman Antoun thanked Ludgate for her contributions and welcomed Larsen as a voice to help drive the next stage of growth.

A bullish thesis on Open Text Corporation argues the enterprise software firm is deeply undervalued following post-Micro Focus weakness, with a refreshed board and new CEO driving restructuring and portfolio simplification. The company is pruning non-core assets from the Micro Focus acquisition, targeting 15 to 20 percent revenue divestiture to improve organic growth into low to mid single digits. Financially, OpenText trades at decade-low EV/EBITDA multiples while generating strong free cash flow, with FCF yield exceeding 18 percent or more than 4 dollars per share, and disciplined capital allocation focused on debt reduction and buybacks. The bull case supports a re-rating toward historical 10x EBITDA multiples as growth stabilizes, implying a price target above 55 dollars per share and over 100 percent upside from current levels.