August 15, 2019 San Mateo / CA / USA - Opentext headquarters in Silicon Valley; OpenText Corporation is a Canadian company that develops and sells enterprise information management software
Sticking with the technology sector, shares of Waterloo-based Open Text have not held up nearly as well as Calian's stock in 2022. Robert Spafford, vice-president and portfolio manager at Cidel Asset Management, says the recent drop presents a "wonderful opportunity" to own the software provider.
"The combined entity will generate significant free cash flow that will be used to rapidly reduce the debt," Spafford said. "We do not think that the acquisition will preclude Open Text from continuing to raise the dividend. As tangible proof of its high free cash flow margin and acquisition-driven business model, Open Text has grown its dividend on average 15 per cent annually over the past decade."Annual dividend yield: 3.