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Oracle's PE / EBITDA Multiples Trading at a Steep Discount

Oracle Corporation (NYSE:ORCL) is expected to report earnings on Thursday after the market closes. The company's shares last traded at $40.47 as of Monday, approximately 96% of its 52 week high. fair value data implies that the stock is currently 9% undervalued while Wall Street's consensus price target of $44.13 also implies 9% upside.

Oracle's efficiency ratios look attractive when compared to its publicly traded peer group:, inc. (NYSE:CRM), Red Hat, Inc. (NYSE:RHT), Microsoft Corporation (NasdaqGS:MSFT) and VMware, Inc. (NYSE:VMW). The company's return on equity (ROE) of 19% is above the group average of 14%. Similarly, return on assets (ROA) and return on invested capital (ROIC) are also above the group average. Microsoft is the only peer that has outperformed Oracle in all three categories.

Continue reading the analysis.

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