CIBC World downgraded Open Text (OTEX) to sector perform from outperform, noting the company's shortfall in revenue and its bottom line.
Analyst Paul Lechem says sizable risks remain with the company's product repositioning under way. He adds that, while revenue expectations had been modest this year, Open Text is seeing ongoing year over year declines even while competitors are seeing return to more positive growth. He thinks the company's fourth quarter outlook is for more of the same. He cut his $1.07 fiscal year 2006 EPS estimate to $1.01, and his $22 stock price target to $18.