Oracle Corp (ORCL) Stock Analysis and Metrics

Sector: Technology Industry: Software - Infrastructure CIK: 0001341439

P/B 17.83

P/E 34.61

P/S 8.75

Market Cap 533.93 Bn

ROIC (Qtr) 12.59

Div Yield % 1.01

Rev 1y % (Qtr) 14.22

Total Debt (Qtr) 124.39 Bn

Debt/Equity (Qtr) 4.15

About

Oracle Corporation, commonly known as Oracle, is a multinational technology company that specializes in providing a wide range of products and services. Its full name is Oracle Corporation, and its stock symbol is ORCL. The company is a leader in the enterprise software solutions industry, offering a variety of products and services to its customers. Oracle's primary business activities revolve around providing software solutions, hardware products, and services to its clients. The company's software solutions include database management systems,...

Oracle Corporation, commonly known as Oracle, is a multinational technology company that specializes in providing a wide range of products and services. Its full name is Oracle Corporation, and its stock symbol is ORCL. The company is a leader in the enterprise software solutions industry, offering a variety of products and services to its customers.

Oracle's primary business activities revolve around providing software solutions, hardware products, and services to its clients. The company's software solutions include database management systems, enterprise resource planning (ERP) software, customer relationship management (CRM) software, and cloud computing services. Oracle's hardware products consist of servers, storage systems, and networking equipment. Additionally, the company offers consulting, implementation, and support services to its customers.

Oracle generates revenue through its three main businesses: cloud and license, hardware, and services. The cloud and license business is the company's largest business segment, accounting for approximately 70% of its revenue. This segment includes the company's software solutions and cloud computing services. Oracle's hardware business is the second-largest business segment, making up around 20% of its revenue. This segment includes the company's hardware products, such as servers and storage systems. The services business is Oracle's smallest business segment, accounting for approximately 10% of its revenue. This segment includes consulting, implementation, and support services for the company's clients.

Oracle has a strong competitive position in the enterprise software market, with a vast customer base and a wide range of products and services. The company's products and services are utilized by various industries, including finance, healthcare, retail, and government. Oracle's key competitors in the market are Microsoft, SAP, and IBM.

The company's primary products and services include Oracle Database, Oracle Fusion Middleware, Oracle Fusion Applications, Oracle Cloud, and Oracle Autonomous Database. Oracle Database is a relational database management system that is used to store and manage data. Oracle Fusion Middleware is a software platform that offers a set of tools and services for building and deploying enterprise applications. Oracle Fusion Applications is a suite of ERP and CRM software applications that are used to manage business operations. Oracle Cloud is a cloud computing platform that provides a range of services, including infrastructure, platform, and software as a service. Oracle Autonomous Database is a self-driving database that uses machine learning and artificial intelligence to automate database operations.

Oracle's customers include a wide range of organizations, from Fortune 500 companies to government agencies and small and medium-sized businesses. The company's clients use its products and services to manage their business operations, improve their efficiency, and reduce their costs.

Stock Price Chart

Analysis

Pros

Healthy cash reserves of 19.24B provide 2.38x coverage of short-term debt 8.09B, demonstrating strong liquidity position and minimal refinancing risk.
Tangible assets of 139.02B provide exceptional 13.99x coverage of deferred revenue 9.94B, showing strong service capability backing.
Strong operating cash flow of 22.30B provides 2.17x coverage of SG&A expenses 10.28B, showing efficient operational cost management.
Tangible assets of 139.02B provide robust 7.11x coverage of other current liabilities 19.56B, indicating strong asset backing.
Operating cash flow of 22.30B fully covers other non-current liabilities 10.50B by 2.12x, showing strong long-term stability.

Cons

Operating cash flow of 22.30B barely covers its investment activities of (31.59B), with a coverage ratio of -0.71, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
Investment activities of (31.59B) provide weak support for R&D spending of 10.13B, which is -3.12x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
Operating cash flow of 22.30B provides thin coverage of dividend payments of (5.37B) with a -4.15 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
The company's operating cash flow of 22.30B shows concerning coverage of stock compensation expenses of 4.78B, with a 4.67 ratio indicating potential earnings quality issues.
Free cash flow of (13.18B) provides weak coverage of capital expenditures of 35.48B, with a -0.37 ratio suggesting additional external financing needs for growth initiatives.

Peer Comparison

Companies in the Software - Infrastructure

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	MSFT	Microsoft Corp	3,542.10 Bn	33.76	12.06	60.56 Bn
2	ORCL	Oracle Corp	533.93 Bn	34.61	8.75	124.39 Bn
3	PLTR	Palantir Technologies Inc.	437.56 Bn	399.47	112.31	0.24 Bn
4	PANW	Palo Alto Networks Inc	125.16 Bn	112.03	13.10	0.35 Bn
5	CRWD	CrowdStrike Holdings, Inc.	120.85 Bn	-384.67	26.47	0.82 Bn
6	SNPS	Synopsys Inc	71.69 Bn	35.89	11.14	15.14 Bn
7	NET	Cloudflare, Inc.	67.84 Bn	-658.43	33.70	3.50 Bn
8	FTNT	Fortinet, Inc.	63.33 Bn	33.80	9.66	1.00 Bn

Industry Comparisons

Current Valuation

Metric	Value	Industry
EV to Assets	3.07	2.56
EV to Cash from Ops.	28.21	38.32
EV to Debt	5.06	-11.37
EV to EBIT	29.64	-12.79
EV to EBITDA	24.56	7.72
EV to Free Cash Flow [EV/FCF]	-47.71	24.22
EV to Market Cap	1.18	0.58
EV to Revenue	10.31	-35.00
Price to Book Value [P/B]	17.83	3.74
Price to Earnings [P/E]	34.61	-18.61

Dividend Metrics

Metric	Value	Industry
Dividend Coverage Ratio	2.87	-0.30
Dividend Payout Ratio %	34.90	2.69
Dividend per Basic Share	1.90	0.10
FCF Dividend Payout Ratio %	-41.29	1.67
Interest Coverage	5.51	-13.15

Growth Metrics

Metric	Value	Industry
Capex Growth (1y) %	-230.17	-404.11
Cash and Equivalents Growth (1y) %	75.86	226.02
Dividend Growth (1y) %	18.75	-0.27
EBIAT Growth (1y) %	28.43	31.15
EBITDA Growth (1y) %	12.86	49.02
EBIT Growth (1y) %	27.30	25.85
EBT Growth (1y) %	31.52	17.82
EPS Growth (1y) %	29.45	70.69
FCF Growth (1y) %	-238.14	295.45
Gross Profit Growth (1y) %	6.83	49.96

Liquidity Ratios

Metric	Value	Industry
Asset Utilization Ratio	0.30	0.68
Cash Payout Ratio	0.09	0.02
Cash Ratio	0.51	1.21
Current Ratio	0.91	2.57
Debt to Equity Ratio	4.15	-0.93
Interest Cover Ratio	5.51	-13.15
Times Interest Earned	5.51	-13.15

Profitability

Metric	Value	Industry
EBITDA Margin %	46.50	-544.82
EBIT Margin %	34.78	-197.78
EBT Margin %	28.47	-602.74
Gross Margin %	68.50	52.06
Net Profit Margin %	25.30	-605.52

Oracle Corp (NYSE: ORCL)