Artificial intelligence (AI) has transformed from a niche innovation to a driving force behind major technological advancements, with businesses across industries racing to incorporate its benefits. Whether it's streamlining operations, automating workflows, or improving customer experiences, AI's utility is far-reaching and shows no signs of slowing down.

For investors, this signals a tremendous opportunity: the potential for steady, long-term gains from companies leading the charge in AI integration. The beauty of AI stocks lies not just in growth potential but in the ability to innovate within existing markets and create entirely new ones. Industries like healthcare, finance, logistics, and even creative arts are being reshaped by AI's capabilities, with significant returns awaiting those who position themselves early.

Consider OpenText

Amid this broader AI investment theme, OpenText (TSX:OTEX) is emerging as a particularly attractive long-term opportunity. Specializing in enterprise information management, OpenText bridges the gap between data and actionable insights — an essential component for businesses looking to harness the power of AI.

What makes OpenText particularly compelling is its focus on integrating AI within its software and cloud solutions. As companies grow increasingly dependent on data management and analysis, OpenText's services are becoming more valuable by the day. AI tools like intelligent document processing, automated workflows, and advanced analytics are central to OpenText's offerings, positioning the company squarely within this technology boom.

Recent performance

Financially, OpenText has demonstrated both stability and growth, even amid uncertain market conditions. For fiscal year 2024, the AI stock reported revenues of $5.77 billion, reflecting a 28.6% year-over-year increase. While some tech companies struggle with profitability during expansion phases, OpenText has maintained solid margins.

In its most recent earnings report, OpenText delivered robust results that highlight its momentum. For the first quarter of fiscal 2025, revenue came in at $1.27 billion, with solid free cash flow supporting the company's continued investment in innovation. Quarterly earnings per share (EPS) showed growth, reflecting management's ability to balance expansion with profitability. While revenue faced some year-over-year contraction due to acquisition-related adjustments, OpenText's leadership reaffirmed its commitment to achieving strong margins and delivering shareholder value.

Operating margins currently sit at 19.92%, reflecting strong cost management alongside revenue growth. Plus, OpenText boasts a trailing price-to-earnings (P/E) ratio of 17.11 and a forward P/E of 8.08, indicating that the AI stock is trading at a substantial discount relative to its earnings potential. These metrics are significant for long-term investors seeking value alongside growth.

Future favourite

The recent drop in OpenText's stock price, down 32% from its 52-week high, adds another layer of appeal for investors. While market downturns are often viewed with concern, seasoned investors recognize these moments as opportunities to buy strong companies at a discount. OpenText's decline likely stems from broader market volatility rather than any fundamental weaknesses within the company itself. With a 3.49% forward annual dividend yield, OpenText also offers an appealing income component for investors looking to balance growth with steady payouts. The AI stock's consistent dividends, backed by strong cash flow of over $842 million in operating cash flow, reinforce its reliability.

Looking to the future, OpenText's growth prospects appear bright. The AI stock continues to focus on expanding its cloud and AI capabilities, two areas with massive growth potential. Cloud-based solutions are already seeing rapid adoption worldwide, and the addition of AI-powered insights makes these tools even more essential for modern businesses. OpenText's ability to integrate seamlessly into the enterprise, providing solutions for everything from compliance to workflow automation. This places it in a sweet spot for ongoing digital transformation trends. As businesses navigate increasingly complex data challenges, demand for OpenText's tools will only increase.

Bottom line

For investors looking to capitalize on AI's long-term growth, OpenText offers a balanced opportunity: exposure to an innovative, AI-driven future at a value-oriented price. The AI stock's financial stability, consistent dividend yield, and strategic focus on expanding its AI capabilities make it an ideal stock to hold for years to come. With shares down significantly from their highs, now may be the perfect time to add OpenText to your portfolio before the broader market catches on to its true potential. Long-term investors can rest assured knowing that OpenText is well-positioned to thrive as the AI revolution continues to shape our world.