OpenText (TSX:OTEX) & Constellation (TSX:CSU): 2 Trending Tech Stocks

Summary

  • Stocks of OpenText Corporation jumped about 17 per cent in November and were trading flat in December.
  • OpenText pays a quarterly dividend US$ 0.201, which currently has an yield of 1.823 per cent.
  • Constellation Software shares recorded a jump of about 30 per cent in 2020 and almost 15 per cent in the month of December.
  • Revenue shot up about 15 per cent YoY to US$ 1,003 million in the third quarter of 2020 for Constellation Software.

Technology stocks of Canadian companies OpenText Corporation (TSX: OTEX) and Constellation Software Inc (TSX: CSU) are currently trending high on the stock markets. While OpenText made headlines recently for its US$-290 million settlement deal with the US IRS, Constellation Software was on the news around December after its subsidiary Volaris Group acquired tech company SSP Limited.

The S&P/TSX Capped Information Technology index jumped nearly 55 per cent last year and about 10 per cent quarter-to-date (QTD). Let’s take a closer look at the trending tech stocks of OpenText Corporation and Constellation Software Inc.

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OpenText Corporation (TSX: OTEX)

Current Stock Price: C$ 57.84


Stocks of OpenText Corporation jumped over 19 per cent in the last nine months since tumbling amid the pandemic-triggered March lows. The scrips climbed about 17 per cent in November and were trading flat in December.

OpenText shares posted a 52-week high of C$ 64 and a 52-week low of C$ 42.3. The C$ 15.7-billion market cap company records a price-to-book (P/B) ratio of 3.022 and a return on equity (ROE) of 6.6 per cent, as per the TMX data.

OpenText pays a quarterly dividend US$ 0.201, which currently has an yield of 1.823 per cent.

The cloud-based service provider saw a 43.7 per cent year-over-year (YoY) increase in its revenues of US$ 341 million from cloud services and subscription in the first quarter of fiscal 2021. OpenText posted cash and cash equivalents of US$ 1.85 billion by the end of September 2020.

Earlier in December, OpenText Corporation reached an agreement with the US Internal Revenue Service (IRS) to settle a claim of US$ 830 million regarding the company’s taxable income from financial years 2010 and 2012. The Toronto-based tech firm agreed to pay US$ 290 million to the IRS in the deal.

 

Constellation Software Inc (TSX: CSU)

Current Stock Price: C$ 1,652.92


Constellation Software is rallying on the Toronto Stock Exchange (TSX) among trending tech stocks and stocks with largest monthly price gains.

Stocks of the Toronto-based software company climbed nearly 12 per cent in the last three months and almost three per cent in December. Constellation Software shares recorded a jump of about 30 per cent in 2020 and almost 15 per cent in the month of December.

YTD chart of Constellation Software’s stock performance (Source: Refinitiv/Thomson Reuters)

Revenue shot up about 15 per cent YoY to US$ 1,003 million in the third quarter of 2020 for Constellation Software. Its net income was up 50 per cent YoY to US$ 122 million in the Q3 ending 30 September 2020.

The company distributes a dividend of US$ 1 on a quarterly basis. The dividend, payable on January 11 this year, currently yields 0.317 per cent, as per the data on the TMX Group.

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