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Open TextOTEX -0.64%87 Forward Rate of Return (Yacktman) % is 26.65% as of Jun. 2026, which is 11% above its 10-year median of 24.03. GuruFocus rates OTEX with a GF Score™ of 87/100 and a GF Value™ of $31.43 (Modestly Undervalued). The stock has 1 warning sign investors should review. Among 1,377 Software companies, Open Text ranks better than 90.85% on this metric.
Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Open Text's forward rate of return for was 26.65%.
The historical rank and industry rank for Open Text's Forward Rate of Return (Yacktman) % or its related term are showing as below:
OTEX'
s Forward Rate of Return (Yacktman) % Range Over the Past 10 Years
Min: 12.74 Med: 24.03 Max: 32.27
Current: 25.48
During the past 13 years, Open Text's highest Forward Rate of Return was 32.27. The lowest was 12.74. And the median was 24.03.
OTEX's Forward Rate of Return (Yacktman) % is ranked better than 90.85% of 1377
companies
in the Software industry
Industry Median: 13.08
vs OTEX: 25.48
Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Open Text (NAS:OTEX) Forward Rate of Return (Yacktman) % Explanation
Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.
Be Aware
In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.
Open Text Forward Rate of Return (Yacktman) % Related Terms
Open Text Forward Rate of Return (Yacktman) % Historical Data
* Premium members only.
The historical data trend for Open Text's Forward Rate of Return (Yacktman) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Open Text Forward Rate of Return (Yacktman) % Chart
OTEX vs CRM, SHOP, UBER: Forward Rate of Return (Yacktman) % Comparison
For the Software - Application subindustry, Open Text's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Open Text Forward Rate of Return (Yacktman) % vs Software Industry
For the Software industry and Technology sector, Open Text's Forward Rate of Return (Yacktman) % distribution charts can be found below:
* The bar in red indicates where Open Text's Forward Rate of Return (Yacktman) % falls into.
Open Text Forward Rate of Return (Yacktman) % Calculation
Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
Open Text's Forward Rate of Return of Jun. 2026 is
Forward Rate of Return
=
Normalized Free Cash Flow
/
Price
+
5-Year EBITDA Growth Rate
=
2.94990476
/
22.15
+
0.1135
=
24.67 %
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
What does a Forward Rate of Return (Yacktman) % of 26.65% mean?
Open Text (OTEX) has a Forward Rate of Return (Yacktman) % of 26.65% as of Jun. 2026. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Open Text and its competitors. This is 11% above median its historical median of 24.03. Over the past decade, Open Text's Forward Rate of Return (Yacktman) % has ranged from 12.74 to 32.27. According to the industry distribution chart, Open Text ranks #126 out of 1377 companies in the Software industry, placing it in the top 9.2%.
Is Open Text's Forward Rate of Return (Yacktman) % too high?
Open Text's current Forward Rate of Return (Yacktman) % of 26.65% is 11% above median its 10-year median of 24.03. Over the past 10 years, this metric has ranged from a low of 12.74 to a high of 32.27. The Software industry median Forward Rate of Return (Yacktman) % is 13.08. Open Text's value of 26.65% is 103.7% above this industry median. Based on the distribution chart, Open Text ranks #126 out of 1377 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Open Text has a GF Score™ of 87/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Open Text's Forward Rate of Return (Yacktman) % compare to CRM and SHOP?
According to the Software industry distribution chart, Open Text ranks #126 out of 1377 companies for Forward Rate of Return (Yacktman) %. This places Open Text in the top 9% of its industry — outperforming the majority of peers. The industry median Forward Rate of Return (Yacktman) % is 13.08. Open Text's value of 26.65% is 103.7% above this benchmark. Historically, Open Text's own Forward Rate of Return (Yacktman) % has ranged from 12.74 to 32.27 over the past decade. While the company's 10-year median is 24.03 vs. the industry median of 13.08, Open Text has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Forward Rate of Return (Yacktman) % for a Software company?
The median Forward Rate of Return (Yacktman) % among Software companies is 13.08, based on 1,377 companies in the industry. Companies in the top quartile (top 25%) have a Forward Rate of Return (Yacktman) % significantly above this median, while those in the bottom quartile fall well below. However, Forward Rate of Return (Yacktman) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Open Text's current Forward Rate of Return (Yacktman) % of 26.65% is 103.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Forward Rate of Return (Yacktman) % mean?
A high Forward Rate of Return (Yacktman) % can signal that a stock is expensive relative to its fundamentals. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Open Text and its competitors. For the Software industry, the median Forward Rate of Return (Yacktman) % is 13.08 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Open Text's current Forward Rate of Return (Yacktman) % is 26.65%, which is 11% above median its own 10-year median of 24.03. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Open Text stock overvalued right now?
Based on GuruFocus' analysis, Open Text (OTEX) is currently considered Modestly Undervalued. The stock's GF Value™ is $31.43, compared to a current price of $24.92 — trading 20.7% below its estimated fair value. The current Forward Rate of Return (Yacktman) % is 26.65%, which is 11% above median its 10-year median of 24.03 and 103.7% above the Software industry median of 13.08. Open Text's overall GF Score™ is 87/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Forward Rate of Return (Yacktman) % calculated?
Forward Rate of Return (Yacktman) % is calculated from a company's financial statements. For Open Text (OTEX), the current Forward Rate of Return (Yacktman) % is 26.65% as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Open Text (OTEX) Overvalued in 2026?
Based on GuruFocus' analysis, Open Text stock appears to be undervalued.
The current stock price of $24.92 is trading 20.7% below its estimated GF Value™ of $31.43.
GuruFocus considers Open Text to be Modestly Undervalued.
Key valuation signals for OTEX:
Forward Rate of Return (Yacktman) %: 26.65% (11% above median its 10-year median of 24.03)
GF Value™: $31.43 vs. price of $24.92 (20.7% below fair value)
Industry Position: 103.7% above the Software median (#126 of 1377)
No single metric tells the full story. See the OTEX stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Open Text Corp is engaged in the design, development, marketing, and sale of Information Management software and solutions. Its software allows clients to archive, aggregate, retrieve, and search unstructured information (such as documents, e-mail, and presentations). Its platform and services provide secure and scalable solutions for enterprises, SMBs, governments, and consumers around the world. The company's solutions are marketed and delivered on the OpenText Cloud Platform, which is a comprehensive Information Management platform consisting of six business clouds; Content Cloud, Cybersecurity Cloud, Application Automation Cloud, Business Network Cloud, IT Operations Management Cloud, and Analytics Cloud. Geographically, it derives maximum revenue from the United States.
87GF Score
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Forward Rate of Return (Yacktman) % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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