ORCL
Oracle Corporation
$144.36
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 19.8% below fair value
You pay
$145.34
Bear
$151.81
Fair
$181.33
Bull
$210.86
Bear
$151.81
+4.5%
$5.93 × 20x P/E
Fair
$181.33
+24.8%
$5.93 × 24x P/E
Bull
$210.86
+45.1%
$5.93 × 28x P/E
Key Value Driver
Normalized P/E multiple (24x base case)
Implied Market Multiple
24.5x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $249.18 from 86 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $181.33 per share.
Warnings
Wall Street's average price target is $249.18 (from 86 analysts). Our estimate is 42% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples