Bottom Up Investing
Tech, value, hedge fund manager, telecom

OpenText: A Good Company That Is Modestly Overvalued

OpenText (NASDAQ:OTEX) provides enterprises with Enterprise Information Management applications. Given the substantial growth rate of information, the company is well positioned to meet enterprise needs. Companies need to be able to organize the storage of information and be able to retrieve that information efficiently.

The share price of OpenText peaked just below $75. Currently, the stock is trading at roughly $65.41. On a total return basis, OpenText has outperformed the S&P 500. But, more recently, the company has underperformed the benchmark index. That means there is potential for OpenText to outperform, near term.

OpenText is a cyclical company that benefits from loose monetary policy conditions. Right now, the company is modestly overvalued. I would consider short selling at...

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