ORCL
Oracle Corp
TMT
10/23/2017
Presented
| Date | 10/18/2017 |
| Price | $49.58 |
| Market Cap | $212.40B |
| Ent Value | $202.42B |
| P/E Ratio | 21.65x |
| Book Value | $13.42 |
| Div Yield | 1.53% |
| Shares O/S | 4,284.00M |
| Ave Daily Vol | 13,743,491 |
| Short Int | 1.07% |
Current
| Price | $174.09 |
| Market Cap | $482.41B |
| Oracle Corp. designs, develops, markets, and supports a diversified line of business software products. The company is organized into the following businesses: Software and Cloud, Hardware Systems and Services. The Software and Cloud business operates through the following segments: New Software Licenses and Cloud Software Subscriptions, Cloud Infrastructure-As-A-Service and Software License Updates and Product Support. The New Software Licenses and Cloud Software Subscriptions segment includes database, middleware and application software licenses, as well as its Oracle cloud software-as-a-service and platform-as-a-service offerings. The cloud infrastructure-as-a-service segment provides deployment and management offerings for its software and hardware and related IT infrastructure. The Software License Updates and Product Support segment provide customers with rights to software product upgrades and maintenance releases and patches released during the term of the support period. The Hardware Systems business operates through the following segments: Hardware Systems Products and Hardware Systems Support. The Hardware Systems Products segment provides a broad selection of hardware systems and related services including servers, storage, networking, virtualization software, operating systems and management software to support diverse IT environments, including cloud computing environments. The Hardware Systems Support segment provides customers with software updates for software components that are essential to the functionality of its server and storage products, such as Oracle Solaris and certain other software products, and can include product repairs, maintenance services and technical support services. The Services business offer services solutions to help customers and partners maximize the performance of their investments in Oracle technology. Oracle was founded on June 16, 1977 by Lawrence Joseph Ellison, Robert Nimrod Miner and Edward A. Oates and is headquartered in Redwood City, CA. |
Publicly traded companies mentioned herein: Oracle Corp (ORCL)
Highlights
The presenter is long shares of Oracle (ORCL) at $49, seeing a favorable risk/reward set-up. He believes growth in cloud and SaaS revenues are set to perform in-line with expectations, and that guidance is currently too conservative. Near-term results could assuage some uncertainty around growth and accelerated declines in software revenue, but he acknowledges that there are a number of moving parts to the ORCL story with a certain degree of opacity. He frames the bull/bear debate around the potential for the long-term cloud transition, which is expected to lead revenue and margins, and consequently earnings growth, to outpace the rate of decline in ORCL’s legacy software businesses. At current levels, the presenter thinks ORCL is “closer to the bull story than to the bear story,” and ORCL shares could appreciate to $56 in 9 - 12 months’ time, with downside of around $47 in his risk/reward analysis.
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