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Today we're going to take a look at the well-established Oracle Corporation (NYSE:ORCL). The company's stock saw a significant share price rise of over 20% in the past couple of months on the NYSE. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Oracle’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for Oracle
What Is Oracle Worth?
Good news, investors! Oracle is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $116.65, but it is currently trading at US$81.39 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Oracle’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from Oracle?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to more than double over the next couple of years, the future seems bright for Oracle. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
What This Means For You
Are you a shareholder? Since ORCL is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on ORCL for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy ORCL. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.
If you want to dive deeper into Oracle, you'd also look into what risks it is currently facing. To that end, you should learn about the 4 warning signs we've spotted with Oracle (including 2 which don't sit too well with us).