Oracle’s Common Stock Faces Structural Disadvantage to Mandatory Convertible Preferred Shares, Heightening Downside Risk for Investors

Oracle Corporation (ORCL) has disclosed a new risk, in the Share Price & Shareholder Rights category.

He notes that Oracle Corporation’s common stock is structurally subordinate to its Mandatory Convertible Preferred Stock for both dividends and liquidation proceeds, which could reduce the attractiveness of the common shares to income-focused or risk-averse investors. In a stress scenario, this priority could materially limit residual value and cash return available to common shareholders, increasing their downside risk profile relative to preferred holders.

Overall, Wall Street has a Strong Buy consensus rating on ORCL stock based on 27 Buys and 4 Holds.

To learn more about Oracle Corporation’s risk factors, click here.