UPDATE: Paradigm Capital Downgrades OpenText on Possible Turbulence Ahead

In a report published on Monday, Paradigm Capital analyst Gabriel Leung downgraded

from Buy to Hold and maintained a price target of $70. In the report, Paradigm Capital stated, "Valuation-wise, the stock is now trading at 12x forward 12-month EPS or 9.5x EV/EBITDA versus its 2-year highs of 14.5x for P/E and 11.5x for EV/EBITDA. Although we believe OpenText's trading multiple could continue to benefit from an overall sector rotation into technology names, along with a Canadian (large-cap) technology scarcity premium, we also believe the company could be approaching a near-term valuation headwind." OpenText closed on Friday at $68.62.