Oracle Corp

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ORCL : NYSE : Technology
$39.23 | %
Today's Range: 39.03 - 39.42
Avg. Daily Volume: 12,395,400
09/23/16 - 4:00 PM ET

Financial Analysis


ORACLE CORP's gross profit margin for the first quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. ORACLE CORP is extremely liquid. Currently, the Quick Ratio is 4.74 which clearly shows the ability to cover any short-term cash needs. ORCL managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY16 Q1 FY15
Net Sales ($mil)8595.08448.0
EBITDA ($mil)3274.03408.0
EBIT ($mil)2741.02737.0
Net Income ($mil)1832.01747.0


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)68396.055930.0
Total Assets ($mil)123223.0109706.0
Total Debt ($mil)54056.042050.0
Equity ($mil)47435.047097.0


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin81.9280.69
EBITDA Margin38.0940.34
Operating Margin31.8932.4
Sales Turnover0.30.35
Return on Assets7.298.66
Return on Equity18.9420.17
Debt Q1 FY16 Q1 FY15
Current Ratio4.924.04
Debt/Capital0.530.47
Interest Expense416.0374.0
Interest Coverage6.597.32


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)4106.04282.0
Div / share0.150.15
EPS0.430.4
Book value / share11.5511.0
Institutional Own % n/a n/a
Avg Daily Volume1.2894764E71.2937248E7

Valuation


HOLD. The current P/E ratio indicates a significant discount compared to an average of 62.28 for the Software industry and a discount compared to the S&P 500 average of 25.19. Conducting a second comparison, its price-to-book ratio of 3.42 indicates a premium versus the S&P 500 average of 2.82 and a significant discount versus the industry average of 7.58. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, ORACLE CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ORCL 18.81 Peers 62.28   ORCL 11.81 Peers 24.12

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ORCL is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ORCL is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ORCL 13.77 Peers 32.90   ORCL 0.69 Peers 0.86

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

ORCL is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ORCL trades at a discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ORCL 3.42 Peers 7.58   ORCL -1.87 Peers 35.16

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ORCL is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, ORCL is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ORCL 4.36 Peers 5.85   ORCL -2.33 Peers 4.71

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ORCL is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ORCL significantly trails its peers on the basis of sales growth

 

 

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