OTEX
Open Text Corporation
$23.95
Platform & Compounding FCF
80%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 24.6% below fair value
You pay
$23.95
Bear
$31.75
Fair
$31.75
Bull
$35.29
Bear
$31.75
+32.6%
3% stage 1 growth, 11% discount
Fair
$31.75
+32.6%
3% stage 1 growth, 11% discount
Bull
$35.29
+47.3%
4% stage 1 growth, 11% discount
Adjust Assumptions
3.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
33%
Implied Market Multiple
11.0x
Market is pricing in (growth)
0.8%
vs 3.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (26 analysts)
$28.30
Divergence from AlphaVal
12%
Summary
Using a two-stage FCF DCF with 3% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $31.75 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions