ORCL
Oracle Corporation
$147.60
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 17.8% above fair value
You pay
$147.60
Bear
$104.94
Fair
$125.34
Bull
$145.75
Bear
$104.94
-28.9%
$5.83 × 18x P/E
Fair
$125.34
-15.1%
$5.83 × 22x P/E
Bull
$145.75
-1.3%
$5.83 × 25x P/E
Adjust Assumptions
21.5x
5.83$
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
25.3x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (87 analysts)
$236.52
Divergence from AlphaVal
47%
Summary
Applying a 22x P/E to adjusted EPS of $5.83, the base-case value is $125.34 per share.
Warnings
Wall Street's average price target is $236.52 (from 87 analysts). Our estimate is 47% 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