1 Tech Stock You'll Be Glad You Bought When the Bull Market Roars

1 Tech Stock You’ll Be Glad You Bought When the Bull Market Roars

OpenText (TSX:OTEX) stock has been making a lot of announcements in the last year, but this company has a strong future ahead.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published December 13, 2023 10:30 am EST

It can be difficult to find many tech stocks these days that actually have a history. A history that spans more than just a few years back, that is. And it can be even harder to find a tech stock with a strong history.

Yet that’s exactly what we’re going to look at today: a tech stock that you’ll want as we head toward a bull market and one you’ll want to hold onto for decades to come.

A worker uses a double monitor computer screen in an office. — Source: Getty Images

OpenText stock

There’s been a shift for OpenText (TSX: OTEX) stock over the last year or so. The company has become known in the past for acquiring business after business. Whether it be icloud storage, cybersecurity, or other computer-related businesses, the company has continued to pick them up again and again.

It then moved into partnerships with some of the largest tech companies out there. Companies such as Ulta, Alphabet and Microsoft all use the tech stock in some capacity. Yet recently, the company actually sold something instead.

OpenText stock announced it would be selling its mainframe computer business for US$2.275 billion after picking it up along with Micro Focus just last year. The sale will help the company improve its financial position and allow it to focus not just on its already strong cloud business but on artificial intelligence (AI) as well.

Future growth

OpenText stock isn’t just betting that AI will be a fad that comes and goes. In fact, it’s already become such a large part of daily life as to warrant its continuation for the foreseeable future. However, there are some worried that AI will be like the dot-com bubble — one that could eventually burst.

However, OpenText stock isn’t just looking to get in on the craze to drive up the share price. It’s been using AI to its advantage. The company will be able to use the funds from the recent sale to see higher organic growth in its capabilities for both cloud and AI now.

So, even though the company did indeed bring in high profits, it simply wasn’t part of the company’s core overall business or the future of the business. This business has long-term revenue growth marked as between 2% and 4% annually.

The AI to come

At OpenText World, an event held annually by the company, this focus on AI was paramount. The company announced several new vectors that would be directly related to AI. These would include chatbots to help employees find everything from orders and documents to technical analysis.

AI will go on to help track orders, respond rapidly to any issues, and bring OpenText stock to the forefront of the future of AI and how it can be used by companies — not just to bring in interest from shareholders but to help the overall business thrive.

This is why OpenText stock is the tech stock I would certainly consider now and in the future. It’s a company using AI to its advantage rather than as some party trick. With a 2.49% dividend yield and shares up 37% in the last year, it looks to be already climbing for today’s investors.