The Canadian stock market is booming in 2026, continuing the momentum it ended 2025 with. As of this writing, the S&P/TSX Composite Index, which is the benchmark for the Canadian stock market, is up by a massive 48.6% from its 52-week low. Despite the markets hovering around new all-time highs, several high-quality Canadian tech stocks trade at discounted levels.
It might only be a matter of time before the stocks lagging behind the rest of the market start to catch up. Some might even beat the broader market when the bull run comes around for them. One such stock is Open Text Corp. (TSX:OTEX).
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Open Text stock
The $10.6 billion market-cap Canadian tech stock has underperformed the rest of the market. As of this writing, OTEX stock is up by 4.1% in the last 12 months. The broader market is up by 31.3% in the same period.
At current levels, OTEX stock is down by 25% from its 52-week high. Due to the discounted share prices, its dividend yield has become inflated. It pays investors US$0.275 per share each quarter, translating to a 3.7% dividend yield. The question is: Is Open Text stock worth buying right now?
Open Text is a leading provider of cloud and AI-based solutions for organizations worldwide. It effectively develops and sells information management software worldwide. It also offers Software-as-a-Service, Application Programming Interfaces, AI services, DevOps, analytics, and several more cloud-based and AI-centric services.
The company generates revenue through subscriptions, managed services, software licensing, consulting, and training. It has major partnerships with some of the largest tech firms, including Google, Salesforce, and Microsoft.
Recent performance
The first quarter of fiscal 2026 ended in September for Open Text. In the quarter, the company reported a 1.5% increase in its revenue compared to the same quarter in the previous year, hitting the US$1.3 billion mark. The company’s current remaining performance obligations increased by 6% year over year.
Tom Jenkins, the Executive Chair at Open Text, has also outlined a strategy for the business to sell off its non-core business units, divesting up to 20% of the company’s revenue. The company is gearing up to focus on content that trains agentic AI systems. Jenkins believes that the company’s divestiture is not due to short-term market demand. Rather, it is due to operational caution.
The first quarter of fiscal 2026 saw Open Text close 33 deals, blowing past the US$1 million mark. Despite the company’s Q2 revenue guidance coming in below previous estimates, management maintained its outlook for fiscal 2026. This signals confidence in its ability to deliver.
Foolish takeaway
Analysts anticipate that Open Text’s revenue will increase to US$5.4 billion in fiscal 2028, which is a jump from its US$5.2 billion in revenue in fiscal 2025. There is plenty of bullish sentiment around the tech stock. If it is not already in your self-directed portfolio, now would be the right time to consider adding it to your holdings.
