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华尔街日报Inquiry Into Oracle's Competitor Dynamics In Software Industry
Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Oracle (NYSE:ORCL) in comparison to its major competitors within the Software industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in the industry.
Oracle Background
Oracle provides enterprise applications and infrastructure offerings through a variety of flexible IT deployment models, including on-premises, cloud-based, and hybrid. Founded in 1977, Oracle pioneered the first commercial SQL-based relational database management system, which is commonly used by the world's largest companies for high-volume online transaction processing workloads. Besides databases, Oracle also sells enterprise resource planning platforms and cloud infrastructure that play an increasingly important role in large language model training and inferencing.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Oracle Corp | 33.84 | 17.27 | 8.54 | 22.68% | $9.51 | $10.68 | 14.22% |
| Microsoft Corp | 34.42 | 9.91 | 12.30 | 7.85% | $48.06 | $53.63 | 18.43% |
| ServiceNow Inc | 92.73 | 14.09 | 12.68 | 4.52% | $0.89 | $2.63 | 21.81% |
| Palo Alto Networks Inc | 117.65 | 14.95 | 13.80 | 4.05% | $0.5 | $1.84 | 15.66% |
| Fortinet Inc | 32.82 | 80.68 | 9.39 | 33.9% | $0.64 | $1.39 | 14.38% |
| Gen Digital Inc | 30.43 | 6.95 | 3.86 | 5.56% | $0.5 | $0.95 | 25.26% |
| UiPath Inc | 37.95 | 4.43 | 5.61 | 11.08% | $0.02 | $0.34 | 15.92% |
| Monday.Com Ltd | 118.41 | 5.92 | 6.63 | 1.06% | $0.0 | $0.28 | 26.24% |
| Dolby Laboratories Inc | 25.48 | 2.42 | 4.82 | 1.89% | $0.06 | $0.27 | 0.73% |
| CommVault Systems Inc | 71.08 | 26.21 | 5.17 | 5.12% | $0.02 | $0.22 | 18.39% |
| Qualys Inc | 27.70 | 9.68 | 8.03 | 9.7% | $0.06 | $0.14 | 10.41% |
| Teradata Corp | 24.68 | 12.71 | 1.75 | 20.25% | $0.09 | $0.25 | -5.45% |
| Average | 55.76 | 17.09 | 7.64 | 9.54% | $4.62 | $5.63 | 14.71% |
Through an analysis of Oracle, we can infer the following trends:
At 33.84, the stock's Price to Earnings ratio is 0.61x less than the industry average, suggesting favorable growth potential.
The elevated Price to Book ratio of 17.27 relative to the industry average by 1.01x suggests company might be overvalued based on its book value.
With a relatively high Price to Sales ratio of 8.54, which is 1.12x the industry average, the stock might be considered overvalued based on sales performance.
With a Return on Equity (ROE) of 22.68% that is 13.14% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $9.51 Billion, which is 2.06x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
With higher gross profit of $10.68 Billion, which indicates 1.9x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.
The company is witnessing a substantial decline in revenue growth, with a rate of 14.22% compared to the industry average of 14.71%, which indicates a challenging sales environment.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
In terms of the Debt-to-Equity ratio, Oracle stands in comparison with its top 4 peers, leading to the following comparisons:
Oracle is positioned in the middle in terms of the debt-to-equity ratio compared to its top 4 peers.
This suggests a balanced financial structure, where the company maintains a moderate level of debt while also relying on equity financing with a debt-to-equity ratio of 4.15.
Key Takeaways
For Oracle in the Software industry, the PE ratio is low compared to peers, indicating potential undervaluation. The PB and PS ratios are high, suggesting overvaluation relative to industry standards. In terms of ROE, EBITDA, and gross profit, Oracle demonstrates strong performance compared to competitors. However, the company's revenue growth is lower than industry peers, potentially impacting future valuation.
This article was generated by Benzinga's automated content engine and reviewed by an editor.