Oracle (ORCL) AI Stock Analysis

• Market Cap: $603.53B
• Dividend Yield: 0.93%
• Average Volume (3M): 11.10M
• Price to Earnings (P/E): 49.6
• Beta (1Y): 1.43
• Revenue Growth: 8.38%
• EPS Growth: 16.96%
• Country: US
• Employees: 159,000
• Sector: Technology
• Sector Strength: 79
• Industry: Software - Infrastructure
• EPS (TTM): 1.70
• Shares Outstanding: 2,804,234,000
• 10 Day Avg. Volume: 18,228,690
• 30 Day Avg. Volume: 11,102,287
• PEG Ratio: 1.27
• Price to Book (P/B): 183.56
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.72
• Enterprise Value/Market Cap: 0.61
• Enterprise Value/Revenue: 1.68
• Enterprise Value/Gross Profit: 9.41
• Enterprise Value/Ebitda: 4.05
• 1Y Price Target: $206.71
• Price Target Upside: -3.95% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 33

• Rating: 73 Outperform
• Price Target: $240.00 ▲(11.51%Upside)

Oracle's strong financial performance and positive outlook from the earnings call are significant contributors to its overall stock score. Despite high leverage and valuation concerns, the company's strategic focus on cloud and AI, alongside robust revenue growth projections, bolster its investment potential.

Positive Factors

Cloud Growth

Oracle's guidance for significant cloud growth, including IaaS and SaaS, indicates an acceleration in revenue and supports confidence in future performance.

Earnings

Oracle reported 4Q:FY25 revenue of $15.90 billion that beat estimates and non-GAAP EPS of $1.70 surpassed projections.

Partnerships

Oracle's demand is considered durable over the next few years with upside potential from large partnerships.

Negative Factors

Competition

OpenAI contracts worth approximately $45 billion have gone to vendors other than Oracle, such as Microsoft and Coreweave, over the past 6 months.

Investment Strategy

Oracle may over-index investments to the low-margin and capital-intensive training cycle, which may weigh on FCF generation for the foreseeable future.

Valuation

Valuation is stretched, capex elevated, competition fierce, and the macro environment is treacherous.

Oracle Business Overview & Revenue Model

Company Description

Oracle Corporation offers products and services that address enterprise information technology environments worldwide. Its Oracle cloud software as a service offering include various cloud software applications, including Oracle Fusion cloud enterprise resource planning (ERP), Oracle Fusion cloud enterprise performance management, Oracle Fusion cloud supply chain and manufacturing management, Oracle Fusion cloud human capital management, Oracle Advertising, and NetSuite applications suite, as well as Oracle Fusion Sales, Service, and Marketing. The company also offers cloud-based industry solutions for various industries; Oracle application licenses; and Oracle license support services. In addition, it provides cloud and license business' infrastructure technologies, such as the Oracle Database, an enterprise database; Java, a software development language; and middleware, including development tools and others. The company's cloud and license business' infrastructure technologies also comprise cloud-based compute, storage, and networking capabilities; and Oracle autonomous database, MySQL HeatWave, Internet-of-Things, digital assistant, and blockchain. Further, it provides hardware products and other hardware-related software offerings, including Oracle engineered systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software, and related hardware services; and consulting and customer services. The company markets and sells its cloud, license, hardware, support, and services offerings directly to businesses in various industries, government agencies, and educational institutions, as well as through indirect channels. Oracle Corporation was founded in 1977 and is headquartered in Austin, Texas.

How the Company Makes Money

Oracle makes money primarily through several key revenue streams: cloud and license revenues, hardware revenues, and services revenues. Its cloud and license business includes sales from cloud infrastructure and applications, as well as software licensing for its database and middleware products. The hardware business generates revenue from the sale of servers, storage, and networking products. Additionally, Oracle offers maintenance and professional services that provide ongoing support and consulting for its products, further contributing to its revenue. Significant partnerships with global enterprises and government entities also play a crucial role in driving Oracle's earnings, as these collaborations help expand its market reach and customer base.

Oracle Financial Statement Overview

Summary

Oracle demonstrates strong profitability with a robust gross profit margin of 88.5% and solid EBIT and EBITDA margins. However, high leverage with a debt-to-equity ratio of 5.58 and declining free cash flow growth pose potential risks. Despite these concerns, strong ROE and cash flow ratios indicate good financial health.

Income Statement

Oracle's income statement is strong, with a robust gross profit margin of 88.5% TTM and a net profit margin of 21.8% TTM, indicating high profitability. The revenue growth rate was impressive at 5.3% annually from 2023 to 2024 and 5.3% from 2024 to TTM, showing consistent growth. EBIT and EBITDA margins were solid at 31.3% and 24.7% TTM, respectively, reflecting efficient operations.

Balance Sheet

Oracle's balance sheet shows a high debt-to-equity ratio of 5.58 TTM, indicating significant leverage, which could pose a risk. However, return on equity (ROE) was strong at 70.5% TTM, suggesting effective use of equity. The equity ratio was relatively low at 10.7% TTM, highlighting a potential risk in financial stability.

Cash Flow

Oracle's cash flow statement demonstrates robust operating cash flow to net income ratio of 1.71 TTM, indicating strong cash generation relative to earnings. The free cash flow margin is stable, but the free cash flow growth rate decreased by 50.8% from 2023 to TTM, suggesting a need for improvement in cash retention.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
55.78B	52.96B	49.95B	42.44B	40.48B	39.07B
	Gross Profit
38.93B	37.82B	36.39B	33.56B	32.62B	31.13B
	EBIT
17.45B	15.35B	13.67B	15.84B	15.65B	14.15B
	EBITDA
23.72B	21.58B	18.90B	18.96B	18.57B	17.12B
	Net Income Common Stockholders
12.16B	10.47B	8.50B	6.72B	13.75B	10.13B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
17.82B	10.66B	10.19B	21.90B	46.55B	43.06B
	Total Assets
161.38B	140.98B	134.38B	109.30B	131.11B	115.44B
	Total Debt
96.28B	94.47B	90.48B	75.86B	84.25B	71.60B
	Net Debt
78.87B	84.02B	80.72B	54.48B	54.15B	34.36B
	Total Liabilities
144.12B	131.74B	132.83B	115.06B	125.16B	102.72B
	Stockholders Equity
16.73B	8.70B	1.56B	-5.77B	5.95B	12.72B
Cash Flow		Free Cash Flow
5.81B	11.81B	8.47B	5.03B	13.75B	11.57B
	Operating Cash Flow
20.75B	18.67B	17.16B	9.54B	15.89B	13.14B
	Investing Cash Flow
-15.29B	-7.36B	-36.48B	11.22B	-13.10B	9.84B
	Financing Cash Flow
2.64B	-10.55B	7.91B	-29.13B	-10.38B	-6.13B

Oracle Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 215.22
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORCL, the sentiment is Positive. The current price of 215.22 is above the 20-day moving average (MA) of 170.01, above the 50-day MA of 152.23, and above the 200-day MA of 163.19, indicating a bullish trend. The MACD of 11.42 indicates Negative momentum. The RSI at 88.96 is Negative, neither overbought nor oversold. The STOCH value of 91.01 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ORCL.

Oracle Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MSFT	83 Outperform	$3.53T	36.70	33.61%	0.70%	14.13%	12.10%
PANW	81 Outperform	$130.87B	112.31	21.16%	―	13.91%	-50.96%
CRWD	79 Outperform	$119.79B	721.64	-5.76%	―	25.94%	-226.80%
ADBE	77 Outperform	$166.93B	25.05	52.25%	―	10.69%	40.10%
SNPS	77 Outperform	$74.30B	34.48	15.82%	―	0.30%	50.17%
ORCL	73 Outperform	$603.53B	49.59	83.87%	0.93%	8.38%	16.96%
Sector *	62 Neutral	$11.80B	10.10	-7.47%	2.99%	7.37%	-8.16%

Oracle Corporate Events

Oracle Reports Strong Q4 2025 Financial Results

Oracle announced its fiscal 2025 Q4 and full-year financial results, reporting a significant increase in total quarterly revenues by 11% to $15.9 billion and cloud revenue growth of 27% to $6.7 billion. The company also declared a cash dividend of $0.50 per share, payable on July 24, 2025, reflecting its strong financial performance and commitment to returning value to shareholders.

The most recent analyst rating on (ORCL) stock is a Hold with a $167.00 price target. To see the full list of analyst forecasts on Oracle stock, see the ORCL Stock Forecast page.