Is Oracle Corporation (ORCL) A Solid Choice On The Value Front?

The stock of Oracle Corporation (NYSE:ORCL) increased by increased by $1.95 on Friday to finish at $98.25, up 2.02 percent. The last five days have seen an average of 6,515,740 shares of common stock traded. 44 times new highs were reached in the current year, with a gain of $33.56. The average number of shares traded over the last 20 days was 10,054,525, while the average volume over the last 50 days totaled 10,768,810.

ORCL stock appreciated 9.87% since last month. On 09/30/21, the company’s shares reached a one-month low of $87.12. The stock touched a high of $97.97 on 10/22/21, after rallying from a low of $55.14 in 52 weeks. The price of ORCL stock has risen by 51.88% or $33.56 this year, reaching a new high 44 times. Still, the stock price is up 0.29% from the 52-week high.

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Insider Transactions

There have been 11 days since Oracle Corporation (ORCL) last reported insider trading activity on Oct 14. On Oct 14, Director Fairhead Rona Alison acquired 2,277 shares at $96.02 each. This transaction resulted in the insider spending $218,640. On Sep 27, HENLEY JEFFREY sold 156,635 shares at a price of US$90.03. After the transaction, the insider now owns 1,841,002 shares. EVP and General Counsel Daley Dorian had earlier sold 175,000 shares on Sep 27 for $90.58 a share. The transaction was completed for $15,851,092.

Valuation Metrics

Oracle Corporation (ORCL) has a trailing price-to-earnings (P/E) ratio of 20.87. This level actually compares favorably with the industry at large, as the PE for the Software – Infrastructure industry stands at about 47.10. Further, its PE also compares favorably with the Technology sector’s trailing 12 months PE ratio, which comes in at 38.99 right now. The PE ratio of Oracle Corporation has varied between 66.21 and 12.52 in the last five years. Beta for the stock is 0.80. There are also a few other valuation ratios worth considering, including the trailing price-to-sales (P/S) ratio of 6.45, and the price-to-cash flow ratio of 28.17.

Oracle Corporation’s dividend is $1.28 per share per year. With a dividend yield of 1.30%, ORCL has a payout ratio of 21.50%. Company paid $0.32 per share in dividends, remained unchanged from $0.32 last year. A $0.08 dividend increase was reported on Wednesday March 10 2021, making it the 1 consecutive year the dividend has increased. Over the last three years, dividends have increased by 33.33%.

For the three months ended May 30, Oracle Corporation’s current ratio was 2.00. As far as profitability goes, gross margin for the trailing twelve months is 80.20% percent. Oracle Corporation’s EBITDA margin for the year ended May 30 was 46.19%, whereas its operating margin stood at 37.80% for the same period. Based on annual data, it had gross profit of $32.62 billion and revenue of $40.48 billion.

Investors will also look at the performance of the company’s management in order to determine the potential profitability of their investment. ORCL’s return on assets (ROA) during the last 12 months has been 11.60%. There was a 17.80% return on investment (ROI) in the past year. In the meantime, the return on equity (ROE) for the last 12 months was 272.00%. ROE has averaged 3.34 in the past year for the broader industry.

Earnings Surprise

According to Oracle Corporation’s quarterly financial report for the quarter that ended May 30, it had $75.97 billion in total debt versus $16.25 billion in cash and short-term investments. A lower net income was reported in the quarter under review than the previous quarter. Net income for the quarter came in at $18.68 billion, while revenues rose by 3.54% to $21.64 billion. It was predicted that Oracle Corporation’s quarterly earnings would be $1.54, but it ended up being $1.31, beating the consensus by 17.60%. EBITDA was $4.18 billion for the quarter. At the end of Oracle Corporation’s most recent quarter ended May 30, its liabilities totaled 124.05 billion, while its total debt was $82.72 billion. Equity owned by shareholders amounts to $2.74 billion.

Technical Picture

Here’s a quick look at Oracle Corporation’s (ORCL) price momentum from a technical perspective. As of 22 October, the RSI 9-day stood at 73.78%, suggesting the stock is Overbought, with a 14.05% historical volatility rate.

The stochastic %K and %D were 89.48% and 90.04% respectively, while the average true range (ATR) was 1.81. Based on the 14-day stochastic reading of 99.78%, the RSI (14) reading is 70.04%. On the 9-day MACD Oscillator, the stock is at 0.69, and the 14-day reading is at 1.91.

Analyst Ratings

In a note to investors, Monness Crespi & Hardt maintained its a Buy rating on Oracle Corporation (NYSE: ORCL). However, the firm raised their price target to $115, indicating a possible increase of 13.05% in the stock price. Analysts have assigned Oracle Corporation (ORCL) an Hold rating. ORCL is a stock that is recommended for selling by 3 brokerage firms, while 18 companies recommend holding. The stock is underweighted by 1 analyst. Among the analysts who rate the stock, 1 rate it overweight and 5 others recommend it as a buy.

What is ORCL’s price target for the next 12 months?

The current consensus forecast for the stock is between $68.00 and $125.00, with a median target price of $89.00. In analyzing these forecasts, the average price target given by analysts for Oracle Corporation (ORCL) is $91.27.


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