Credit Suisse Downgrades Open Text (OTEX) to Neutral

Credit Suisse downgraded Open Text (NASDAQ: OTEX) from Outperform to Neutral with a price target of $60.00 (from $65.00).

Analyst M. Nemeroff notes that following a small license miss last quarter, OTEX reported another organic license revenue decline in F2Q15 (-6.7%) versus previous expectation for organic license growth of +8.5%. The analyst said investors will not pay as high a multiple for OTEX shares if the company is unable to grow organic license revenue anywhere near the industry growth rate, which OTEX management has previously pegged at ~+10%.

The firm raise F2016 revenue to $2.087B from $2.029B due to the acquisition of Actuate, but lower EPS to $4.10 from $4.20. The firm is lowering EPS estimate for F2015 to $3.80 from $3.87.

For an analyst ratings summary and ratings history on Open Text click here. For more ratings news on Open Text click here.

Shares of Open Text closed at $59.59 yesterday.

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