OTEX Should I Buy
-
$
0.000
0.000(0.000%)
At close0.000(0.000%)Aft-market
ET
Loading...
OTEX is not a good buy right now. Despite being extremely oversold (RSI_6 10) and sitting on/just below first support (26.40), the broader trend is decisively bearish (negative, expanding MACD + bearish MA stack). With hedge funds selling aggressively and earnings on 2026-02-05 (after hours), downside follow-through risk is high enough that buying immediately is not favored for an impatient investor seeking high-probability upside.
Trend and momentum are bearish. MACD histogram (-0.388) is below zero and expanding negatively, signaling strengthening downside momentum. Moving averages are bearishly aligned (SMA_200 > SMA_20 > SMA_5), confirming a sustained downtrend. RSI_6 at 10 indicates extreme oversold conditions that can produce sharp dead-cat bounces, but oversold alone is not a reliable entry when momentum is still deteriorating. Price is trading near S1 (26.398) with pre-market at 26.38 (slightly below support); a clean reclaim above ~26.40–26.50 would be needed to reduce immediate breakdown risk. Key levels: downside support S2 ~24.85; upside pivot ~28.91 (first meaningful recovery level), then R1 ~31.43.
Intellectia Proprietary Trading Signals:
CEO catalyst: OpenText appointed Ayman Antoun as CEO effective April 20, 2026; the market may view this as a positive inflection point given his cloud/digital modernization background and management’s emphasis on enterprise AI. Earnings catalyst: QDEC 2025 earnings on 2026-02-05 after hours can reset expectations if guidance improves. Financial optics: latest quarter showed strong EPS/net income growth and improved gross margin, which can support a re-rating if repeatable.
Event risk: upcoming earnings (2026-02-
after prior weaker-than-expected Q2 guidance could trigger another leg down if Q3 growth/guidance disappoints. Positioning/flow: hedge funds are selling, with selling amount up ~207.84% QoQ. Options flow: put-heavy volume (put/call volume 6.
suggests near-term bearish sentiment/hedging demand. Statistical drift: pattern-based projection implies slightly negative bias over next day/week (approx. -1.75% next day; -2.36% next week).
Latest reported quarter: 2026/Q1. Revenue grew modestly to 1.288B (+1.51% YoY), indicating low-single-digit top-line growth. Profitability improved sharply: net income 146.6M (+73.78% YoY) and EPS 0.58 (+81.25% YoY), alongside gross margin expansion to 63.82% (+1.66% YoY). The quality question is sustainability (cost actions/one-time items vs. durable demand), especially with the Street focused on guidance and expected ~2% growth outlook.
Recent Street stance is mostly Neutral/Hold with price targets still well above the current price. CIBC (2026-01-16) kept Neutral and cut PT to $37 from $40, citing weaker prior Q2 guidance and focus on upcoming Q3 guidance and divestitures. UBS (2025-11-07) raised PT to $38 (Neutral). Jefferies (2025-11-06) raised PT to $35 (Hold) after an earnings beat but noted Q2 revenue/EBITDA outlook below consensus (management attributed to seasonality while maintaining FY26 guidance). Wall Street pros: targets imply meaningful upside if guidance stabilizes and margin gains persist. Cons: the consensus tone remains cautious (Neutral/Hold), reflecting limited confidence in near-term growth acceleration and elevated guidance risk.
