RRSP Season: 1 Stock I'd Buy and Forget

2026-02-12 15:30:00 ET

Registered Retirement Savings Plan (RRSP) season has a funny way of making everyone feel rushed. Don’t fall for it. The best RRSP buys often look boring in the moment, because the real win comes from letting time and tax deferral do the heavy lifting. When you tuck a long-term compounder into an RRSP, you give it years to grow without tax friction, and you avoid the temptation to trade around headlines. And right now, this tech stock looks like a surprisingly good option.

OTEX

OpenText ( TSX:OTEX ) sells enterprise software that helps large organizations manage, secure, and use their information. Think content management, security, IT operations tools, and analytics that sit behind the scenes in banks, governments, and big industrial firms. It also leans into artificial intelligence (AI) through its Aviator offerings, which aim to help customers search, summarize, and automate work within their own data while staying compliant. That positioning allows firms to use AI gains without handing over sensitive data to an outside platform.

The last year for OpenText looked like a clean-up and refocus phase. It continued digesting the Micro Focus acquisition, pushed harder toward subscriptions, and talked openly about simplifying the portfolio after earlier divestitures. It also managed a leadership change. In its February 2026 update, the dividend stock referenced a transition to Ayman Antoun as CEO, with a steady hand promised through the handoff.

OpenText also kept returning capital, which signals confidence in the cash engine even while it reshapes the product mix. In the latest quarter, it returned US$119 million, including dividends and share repurchases. That doesn’t guarantee growth, but it suggests cash generation can fund reinvestment and shareholder returns at the same time, which fits an RRSP mindset.

Into earnings

Now for the numbers that matter. In its second quarter of fiscal 2026, ended Dec. 31, 2025, OpenText reported total revenue of US$1.3 billion. Cloud revenue was US$478 million, up 3.4% year over year, and it logged its 20th consecutive quarter of organic cloud growth. GAAP net income was US$168 million, and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was US$491 million, a 37% margin. It also produced operating cash flow of US$319 million and free cash flow of US$279 million.

Those results tell a simple story. Revenue held steady, cloud kept inching higher, and profitability stayed robust for a company selling to sticky enterprise customers. The wrinkle is that GAAP net income fell year over year, and operating and free cash flow also dipped from the prior-year quarter. Timing can explain some of that, but it still matters, as long-term holds only feel forgettable when cash flow stays dependable.

Looking ahead, OpenText framed fiscal 2026 as a return to modest growth after divestitures. It pointed to a full-year outlook that targets 3% to 4% cloud revenue growth and 1% to 2% total revenue growth. That’s not thrilling, but that can suit an RRSP approach built on patience and reinvestment.

Bottom line

OpenText could be a buy for RRSP investors who want a cash-generative Canadian tech name with recurring revenue and a realistic path to gradual improvement. Right now, here’s what the 4.2% yield could bring in while trading at a valuable 14 times earnings from an investment of just $7,000.

It could be a miss for anyone who needs rapid growth or hates transition stories. If you want to buy it and forget it, watch one thing: steady cloud growth paired with steady free cash flow, quarter after quarter, with no excuses.

The post RRSP Season: 1 Stock I’d Buy and Forget appeared first on The Motley Fool Canada .

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

2026