oracle corporation (orcl-n) detailed stock report · 2015-02-12 · 5.7 average 53.75 3.2% 7.8%...

STOCKREPORTS+

Last Close34.93 (USD)November 18, 2013NEW YORK Exchange

Avg Daily Vol17.7M

52-Week High36.43

Trailing PE15.1

Annual Div0.48

ROE25.5%

LTG Forecast10.6%

1-Mo Return6.2%

Market Cap156.9B

52-Week Low29.78

Forward PE11.8

Dividend Yield1.4%

Annual Rev37.4B

Inst Own85.5%

3-Mo Return7.8%

AVERAGE SCORE

POSITIVE OUTLOOK: ORCL's current score of8 places it among the top quartile of stocksscored.

Score Averages

Software & IT Services Group: 4.1 Mega Market Cap: 7.5Software & IT Services Sector: 4.1 S&P 500 Index: 6.8

Positive

Neutral

Negative

Average Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013

Peers -6M -3M -1M -1W Current 1Y Trend

ORCL 7 7 7 8 8

SYMC 6 8 7 7 8

INTU 3 9 6 6 6

MSFT 7 6 6 7 6

ADBE 3 4 3 4 4

HIGHLIGHTS THOMSON REUTERS I/B/E/S MEAN- The score for ORACLE CORPORATION has been on a

positive trend from 6 to 8 over the past 6 weeks.

- The recent change in the Average Score was primarily due toan improvement in the Price Momentum component score.

Buy Mean recommendation from all analysts coveringthe company on a standardized 5-point scale.42 Analysts

Sell Reduce Hold BuyStrong

Buy

PRICE AND VOLUME CHARTS1-Year Return: 16.4% 5-Year Return: 105.2%

BUSINESS SUMMARYOracle Corporation is a provider of enterprise software and computer hardware products and services. The Company's software, hardware systems,and services businesses develops, manufactures, markets, hosts and supports database and middleware software, applications software, andhardware systems, with the latter consisting primarily of computer server and storage products. It is organized into three businesses: software,hardware systems and services. Its software business consists of two segments: new software licenses and software license updates and productsupport. Its hardware systems business consists of two segments: hardware systems products and hardware systems support. The Company'sservices business consists of the remainder of its segments and offers consulting services, managed cloud services, and education services. On April5, 2012, the Company acquired Taleo Corporation (Taleo). Effective March 13, 2013, it acquired Nimbula Inc.

ORACLE CORPORATION (ORCL-N)Software & IT Services / Software & IT Services / Software DETAILED STOCK REPORT

Report Date: November 19, 2013

of 12© 2013 Thomson Reuters. All rights reserved.

SAMPLE

STOCKREPORTS+

INDICATOR COMPONENTS

The AVERAGE SCORE combines the quantitative analysis of six widely-used investment decision making tools: Earnings,Fundamental, Relative Valuation, Risk, Price Momentum and Insider Trading. A simple average of the underlying component ratings isnormally distributed to rank stocks on a 1-10 scale (10 being awarded to the most favorable). These factors may be evaluateddifferently using alternative methodologies and the importance of individual factors varies across industries, market capitalization andinvestment styles. Additional criteria should always be used to evaluate a stock.

Earnings Fundamental Relative Valuation Risk Price Momentum Insider Trading

OPTIMIZED SCORE

Historically, companies with an optimized scoreof 2 have tended to significantly underperformthe market over the following 12-month period.

As an alternative approach to equally weighting each of the six factors, independentresearch firm, Verus Analytics, conducted a backtest to empirically determine theoptimal factor blend. Results and weighting vary across four different marketcapitalization categories. For large cap stocks, price momentum and insider tradinghistorically provided the most explanatory power among the six factors and areweighted heavily in the current optimized score. Among the small cap universe, theearnings and fundamental factors joined with insider trading and price momentum toexplain returns.

PEER ANALYSIS Currency in USD

PRICE MOMENTUM VALUATION FUNDAMENTAL ANALYSTS

AverageScore Ticker

Price(Nov/18/13)

1-MoReturn

3-MoReturn

1-YrReturn

MarketCap

TrailingPE

ForwardPE

DividendYield

NetMargin

LTGForecast

I/B/E/SMean

# ofAnalysts

6 MSFT 37.20 6.4% 17.0% 40.3% 315.4B 14.1 14.1 3.0% 28.3% 7.2% Hold 36

8 ORCL 34.93 6.2% 7.8% 16.4% 156.9B 15.1 11.8 1.4% 26.2% 10.6% Buy 42

4 ADBE 56.60 7.5% 24.7% 73.4% 27.4B 65.2 39.8 -- 8.3% 11.7% Buy 24

6 INTU 73.41 6.8% 14.3% 23.8% 20.5B 26.0 20.7 1.0% -2.5% 14.2% Buy 21

8 SYMC 23.65 -6.9% -9.9% 31.6% 16.1B 21.1 13.4 2.5% 14.7% 9.0% Buy 30

9 CA 32.75 8.8% 7.2% 50.2% 14.4B 14.0 12.5 3.1% 20.9% 13.5% Hold 14

7 CHKP 62.44 6.9% 10.4% 43.0% 11.9B 20.0 17.6 -- 46.4% 9.3% Buy 30

4 ADSK 43.30 7.5% 20.5% 37.5% 9.6B 46.0 28.6 -- 11.0% 8.3% Buy 20

4 RHT 46.56 7.6% -9.6% -3.9% 8.2B 57.4 32.0 -- 10.9% 15.6% Buy 32

5 ANSS 84.53 -2.1% -1.9% 25.6% 7.8B 34.1 26.2 -- 29.4% 17.0% Hold 11

2 N 95.92 -13.1% 4.9% 64.2% 7.1B -- 369.6 -- -15.7% 26.0% Hold 24

5.7 Average 53.75 3.2% 7.8% 36.6% 54.1B 31.3 53.3 2.2% 16.2% 12.9% Buy 25.8

PEER COMPANIESMSFT MICROSOFT CORPORATION CHKP CHECK POINT SOFTWAREADBE ADOBE SYSTEMS ADSK AUTODESK INCINTU INTUIT INC RHT RED HAT INCORPORATEDSYMC SYMANTEC CORPORATION ANSS ANSYS INCCA CA INC N NETSUITE INCORPORATION




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STOCKREPORTS+

EARNINGS

NEUTRAL OUTLOOK: Mixed earningsexpectations and performance.

Currency in USD

Earnings Score Averages


Positive

Neutral

Negative

Earnings Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013


SYMC 4 7 9 6 8

ADBE 6 6 4 7 7

INTU 2 3 4 4 5

MSFT 5 2 3 5 4

ORCL 6 3 3 4 4

EARNINGS INDICATORSEarnings Surprises

(33.3% weight)Estimate Revisions

(33.3% weight)Recommendation Changes

(33.3% weight)

SYMC

ADBEMSFTORCLINTU

ADBEINTUORCLMSFT

SYMC

SYMC

ADBEINTUMSFT

ORCL

Last 4 Quarters Last 4 Weeks Last 120 Days# Positive Surprises (> 2%) 2 # Up Revisions 0 # Broker Upgrades 0# Negative Surprises (< -2%) 1 # Down Revisions 0 # Broker Downgrades 1# In-Line (within 2%) 1 Avg Up Revisions 0.0%Avg Surprise 1.9% Avg Down Revisions 0.0%

HIGHLIGHTS PRICE TARGET- ORCL currently has an Earnings Rating of 4. The average Earnings

Rating for its Software Industry is 5.7 and the S&P 500 COMPOSITEaverage is 5.5.

- Over the past 4 quarters, the company has reported 2 positive (>2%),1 negative (<-2%), and 1 in-line (within 2%) surprises. The averagesurprise for this time period has been 1.9%. Most recently onSep/18/13, the company reported quarterly earnings of 0.59 per share,a positive surprise of 5.2% above the consensus of 0.56.

- ORCL's current quarter consensus estimate has remained relativelyunchanged over the past 90 days at 0.67. Estimates within its Industryhave moved an average of -8.0% during the same time period.

The chart indicates where analysts predict the stock price will be withinthe next 12 months, as compared to the current price.

48.00

44.00

40.00

36.00

32.00

28.00Current Price Price Target

34.93MEAN

HIGH

LOW

12-Month Price Target

Mean 36.30High 43.00Low 28.00Target vs. Current 3.9%

# of Analysts 34




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STOCKREPORTS+

EARNINGS PER SHARE

Earnings per share (EPS) is calculatedby dividing a company's earnings by thenumber of shares outstanding. Analyststend to interpret a pattern of increasingearnings as a sign of strength and flator falling earnings as a sign ofweakness.

The charts provide a comparisonbetween a company's actual andestimated EPS, including the high andlow forecasts.

1.000

0.900

0.800

0.700

0.600

0.50011-12 02-13 05-13 08-13 11-13 02-14

Actuals Estimates

0.640 0.650

0.870

0.590

MEANHIGH

LOW

Quarterly 11-13 02-14Mean 0.671 0.699High 0.690 0.720Low 0.630 0.670# of Analysts 34 34

3.900

3.600

3.300

3.000

2.700

2.4002012 2013 2014 2015

Actuals Estimates

2.460

2.680

MEAN

HIGH

LOW

Annual 2014 2015Mean 2.904 3.176High 2.970 3.400Low 2.700 2.840# of Analysts 39 38

MEAN ESTIMATE TREND ANALYST RECOMMENDATIONSQ

11-13Q

02-14Y

2014Y

2015Price

TargetCurrent 0.671 0.699 2.904 3.176 36.3030 Days Ago 0.671 0.699 2.901 3.170 36.2090 Days Ago 0.690 0.707 2.883 3.160 36.00% Change (90 Days) -2.8% -1.1% 0.7% 0.5% 0.8%

Next Expected Report Date: Dec/16/13

Thomson Reuters I/B/E/S Mean: Buy (42 Analysts)

Strong Buy

Buy

Hold

Reduce

Sell

9

16

15

2

0

EARNINGS SURPRISESComparing a company's actual earnings to the mean expectation ofanalysts results in a difference referred to as a 'positive' or 'negative'surprise. Research has shown that when a company reports asurprise, it is often followed by more of the same surprise type.

Surprise Detail (Last 6 Periods)

SurpriseType

AnnounceDate

Period EndDate

ActualEPS

MeanEPS

Surprise(%)

POSITIVE Sep/18/13 Aug/31/13 0.590 0.561 5.2%

IN-LINE Jun/20/13 May/31/13 0.870 0.874 -0.5%

NEGATIVE Mar/20/13 Feb/28/13 0.650 0.664 -2.1%

POSITIVE Dec/18/12 Nov/30/12 0.640 0.610 4.9%

IN-LINE Sep/20/12 Aug/31/12 0.530 0.531 -0.2%

POSITIVE Jun/18/12 May/31/12 0.820 0.782 4.9%

Surprise Summary (Last 12 Quarters)

Surprise Type Amount PercentPositive Quarters (> 2%) 8 66.7%Negative Quarters (< -2%) 2 16.7%In-Line Quarters (within 2%) 2 16.7%

ANNUAL REVENUEA pattern of increasing sales inconjunction with a rising EPS mayinfluence a buy recommendation, whileflat or falling sales and falteringearnings may explain a sellrecommendation. A rising EPS with flator falling sales may result fromincreased cost efficiency and margins,rather than market expansion. Thischart shows the sales forecast trend ofall analysts and the highest and lowestprojections for the current and nextfiscal year.

44B

42B

40B

38B

36B

34B2011 2012 2013 2014 2015

Actuals Estimates

35.8B

37.2B 37.2B

MEANHIGH

LOW

2014 2015Mean 38.4B 40.3BHigh 38.9B 41.1BLow 37.8B 39.3BForecasted Growth 3.2% 8.4%

# of Analysts 38 38




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FUNDAMENTAL

POSITIVE OUTLOOK: Strong fundamentalssuch as high profit margins, low debt levels, orgrowing dividends.

Fundamental Score Averages


Positive

Neutral

Negative

Fundamental Score Trend

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q32011 2012 2013

PeersQ4

2012Q1

2013Q2

2013Q3

2013 Current 3Y Trend

ORCL 10 9 9 9 10

MSFT 8 10 10 10 9

SYMC 10 10 10 10 9

INTU 8 5 7 9 5

ADBE 8 6 5 5 4

FUNDAMENTAL INDICATORSProfitability(25% weight)

Debt(25% weight)

Earnings Quality(25% weight)

Dividend(25% weight)

MSFTSYMCORCL

INTUADBE

MSFT

INTUORCLSYMCADBE

SYMCORCL

INTUMSFT

ADBE

MSFTORCL

INTUSYMC

ADBE

Revenue Growth 1.2%For year over yearending 08/13Gross Margin 73.4%For trailing 4 qtrsending 08/13Return on Equity 25.5%For trailing 4 qtrsending 08/13Net Margin 26.2%For trailing 4 qtrsending 08/13

Current Ratio 3.1For year over yearending 08/13Debt-to-Capital 29.1%For trailing 4 qtrsending 05/13Interest Funding 5.6%For trailing 4 qtrsending 08/13Interest Coverage 13.3For trailing 4 qtrsending 08/13

Days Sales in Inv. 11.1For period ending05/13Days Sales in Rec. 61.0For period ending05/13

Div. Growth Rate 0.0%For year over yearending 05/13Dividend Funding 8.1%For trailing 4 qtrsending 05/13Dividend Coverage 10.4For trailing 4 qtrsending 05/13Current Div. Yield 1.4%For trailing 4 qtrsending 11/13

HIGHLIGHTS- ORCL currently has a Fundamental Rating of 10, which is significantly

more bullish than the Software Industry average of 5.2.- The company's gross margin has been higher than its Industry

average for each of the past five years.- The company's days sales in receivables is at its five-year low.

- Of the 115 firms within the Software Industry, ORACLECORPORATION is among the 18 companies that pay a dividend. Thestock's dividend yield is currently 1.4%.

- The company's current ratio has been higher than its Industry averagefor each of the past five years.




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RELATIVE VALUATION

POSITIVE OUTLOOK: Multiples significantlybelow the market or the stock's historic norms.

Relative Valuation Score Averages


Positive

Neutral

Negative

Relative Valuation Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013


ORCL 8 9 10 9 9

SYMC 5 5 7 7 7

MSFT 7 8 7 6 6

INTU 6 6 6 5 5

ADBE 1 1 1 1 1

RELATIVE VALUATION INDICATORSForward PEG

(50% weight)Trailing PE(25% weight)

Forward PE(25% weight)

ORCL

INTUSYMC

MSFTADBE

MSFTORCL

SYMCINTU

ADBE

ORCLSYMC

MSFTINTU

ADBE

Forward PEG 1.1

5-Yr Average 1.0

Rel. to 5-Yr Avg. 10% Premium

S&P 500 Index 1.8

Rel. To S&P 500 40% Discount

Trailing PE 15.1

5-Yr Average 18.1

Rel. to 5-Yr Avg. 17% Discount

S&P 500 Index 25.4


Forward PE 11.8

5-Yr Average 12.7

Rel. to 5-Yr Avg. 7% Discount

S&P 500 Index 19.5


HIGHLIGHTS- Compared to the Software Industry, ORCL is currently trading at a

significant discount based on Trailing P/E, Forward P/E, and ForwardPEG.

- ORCL's Trailing P/E of 15.1 represents a 17% Discount to its 5-yearaverage of 18.1.

- ORCL currently has a Valuation Rating of 9 which is significantlyabove the S&P 500 COMPOSITE index average rating of 5.8.

- ORCL's Forward PEG of 1.1 represents a 10% Premium to its 5-yearaverage of 1.0.

- ORCL's Forward P/E of 11.8 represents a 7% Discount to its 5-yearaverage of 12.7.




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PRICE TO SALESThe most recent week's close price divided by the revenue per share.

Price to Sales: 4.35-Year Average: 4.4

S&P 500 Index Average: 2.7Software Industry Average: 4.7

3.03.33.63.94.24.54.85.15.45.76.0

20132012201120102009

5-Yr Average

TRAILING PEThe most recent week's close price divided by the sum of the four mostrecently reported quarterly earnings.

Trailing PE: 15.15-Year Average: 18.1


1214161820222426283032

20132012201120102009

5-Yr Average

FORWARD PEThe most recent week's close price divided by the sum of the fourupcoming quarterly consensus estimates.

Forward PE: 11.85-Year Average: 12.7


1011121314151617181920

20132012201120102009

5-Yr Average

FORWARD PEGThe Forward P/E divided by the five-year forecasted growth rate.

Forward PEG: 1.15-Year Average: 1.0


0.00.51.01.52.02.53.03.54.04.55.0

20132012201120102009

5-Yr Average




SAMPLE

STOCKREPORTS+

RISK

POSITIVE OUTLOOK: Consistent returnpatterns (low volatility).

Risk Score Averages


Positive

Neutral

Negative

Risk Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013


INTU 6 9 9 10 10

ORCL 8 8 10 10 10

ADBE 8 8 8 8 8

MSFT 8 7 7 8 8

SYMC 7 6 6 5 5

RISK INDICATORSMagnitude Of Returns

(25% weight)Volatility

(25% weight)Beta (1-year)(25% weight)

Correlation(25% weight)

INTUORCLMSFT

ADBESYMC

INTUORCLADBEMSFT

SYMC ORCL

INTUMSFTSYMCADBE

ADBEORCLINTUMSFT

SYMC

Daily Returns (Last 90 Days)Best 2.5%Worst -1.9%Monthly Returns (Last 60 Months)Best 22.9%Worst -18.2%

Standard DeviationLast 90 Days 0.99Last 60 Months 8.03Intra-Day Swing (Last 90 Days)Last 90 Days Avg 1.5%Last 90 Days Largest 2.8%

Beta vs. S&P 500 0.95Positive Days Only 1.17Negative Days Only 1.13Beta vs. Group 0.82Positive Days Only 0.85Negative Days Only 0.81

Correlation vs. S&P 500Last 90 Days 60%Last 60 Months 70%Correlation vs. GroupLast 90 Days 60%Last 60 Months 71%

HIGHLIGHTS- ORCL currently has a Risk Rating of 10 while the S&P 500

COMPOSITE index has an average rating of 8.3.- On days when the market is up, ORCL shares tends to

outperform the S&P 500 COMPOSITE index. However, ondays when the market is down, the shares generally decreaseby more than the S&P 500 COMPOSITE index.

- In both short-term and long-term periods, ORCL has shownhigh correlation (>=0.4) with the S&P 500 COMPOSITE index.Thus, this stock would provide only low levels of diversificationto a portfolio similar to the broader market.

- Over the past 90 days, ORCL shares have been less volatilethan the overall market, as the stock's daily price has fluctuatedless than 94% of S&P 500 COMPOSITE index firms.

RISK ANALYSISLast 90 Days Last 60 Months

Peers

BestDaily

Return

WorstDaily

Return

#Days

Up

#Days

Down

LargestIntra-Day

Swing

BestMonthlyReturn

WorstMonthlyReturn

ORCL 2.5% -1.9% 37 28 2.8% 22.9% -18.2%

ADBE 9.2% -3.1% 41 23 3.9% 28.1% -32.5%

INTU 1.7% -1.3% 40 23 5.6% 18.5% -20.7%

MSFT 7.3% -4.6% 37 28 3.5% 15.7% -16.5%

SYMC 2.5% -12.7% 36 29 6.5% 21.9% -35.8%

S&P 500 2.2% -1.6% 39 24 1.9% 10.8% -16.9%




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STOCKREPORTS+

PRICE MOMENTUM

NEUTRAL OUTLOOK: Performance relativelyin-line with the market.

Currency in USD

Price Momentum Score Averages


Positive

Neutral

Negative

Price Momentum Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013


ADBE 6 7 9 8 8

INTU 4 9 8 8 8

MSFT 10 5 7 8 7

ORCL 7 6 4 6 6

SYMC 7 10 5 1 2

PRICE MOMENTUM INDICATORSRelative Strength

(70% weight)Seasonality(30% weight)

ADBEINTUMSFT

ORCL

SYMC

ADBEINTUMSFTORCLSYMC

Relative Strength Indicator (scale 1-100, 100 is best)ORCL Industry Avg

Last 1 Month 62 54Last 3 Months 55 53Last 6 Months 53 53

Average Monthly Return (Last 10 Years)NOV DEC JAN

Company Avg -2.1% 3.5% 0.8%

Industry Avg 0.1% 3.9% 2.8%

Industry Rank 93 of 115 59 of 116 41 of 117

PRICE PERFORMANCEDaily close prices are used to calculate theperformance of the stock as compared to arelevant index over five time periods.

ORCL

S&P 500

1-Week

1-Month

3-Month

YTD

1-Year

1.6%1.1%

6.2%2.7%

7.8%8.2%

4.8%25.6%

16.4%31.7%

ORCL S&P 500Close Price (Nov/18/13) 34.93 179252-Week High 36.43 179852-Week Low 29.78 1388

- On Nov/18/13, ORCL closed at 34.93, 4.1% below its 52-weekhigh and 17.3% above its 52-week low.

- ORCL shares are currently trading 4.4% above their 50-daymoving average of 33.47, and 5.2% above their 200-daymoving average of 33.22.

- The S&P 500 COMPOSITE is currently 0.4% below its 52-week high and 29.1% above its 52-week low.




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INSIDER TRADING

NEGATIVE OUTLOOK: Recent or longer-termtrend of selling by company insiders.

Currency in USD

Insider Trading Score Averages


Positive

Neutral

Negative

Insider Score Trend (4-Week Moving Avg)

NOV-2010 NOV-2011 NOV-2012 NOV-2013


SYMC 2 3 4 9 9

INTU 2 8 1 2 2

ADBE 1 1 1 1 1

MSFT 1 3 1 1 1

ORCL 2 1 1 1 1

INSIDER TRADING INDICATORSShort-Term Insider

(70% weight)Long-Term Insider

(30% weight)

SYMC

INTUADBEMSFTORCL

INTUORCLSYMC

ADBEMSFT

Most Recent Buys and Sells (Last 90 days)Name Role Tran Date Tran Type SharesKurian, Thomas O Oct/21/13 - Oct/28/13 S 1,600,000Garcia, Molina Hector D Oct/15/13 S 2,500Kurian, Thomas O Sep/27/13 S 400,000

Insider Summary (Last 6 Months)Total Shares Acquired 6,222,500Total Shares Disposed 6,222,500Net Shares --

Sector Average 33,736

HIGHLIGHTS- ORCL currently has an Insider Rating of 1, which is significantly more

bearish than both the Software Industry average of 3.89 and theSoftware & IT Services Industry Group average of 3.58.

- Executives at ORACLE CORPORATION have not purchased or soldany shares thus far this quarter. Over the past five years, the averagepurchase and sell totals for Q4 have been $14,932 and $50,321,432,respectively.

MONTHLY BUYS AND SELLS

0

D J F M A M J J A S O N

BUYS

SELLS

40

40

80

80

$ Market Value - Millions

Excludesderivativeand optionexercises

TOP INSTITUTIONAL HOLDERS

InstitutionInst.Type

# SharesHeld

ReportedDate

Ellison (Lawrence Joseph) Strategic 1.11B Sep/03/13The Vanguard Group, Inc. Inv Mgmt 171M Sep/30/13Capital Research Global Inv... Inv Mgmt 148M Sep/30/13State Street Global Advisor... Inv Mgmt 146M Sep/30/13BlackRock Institutional Tru... Inv Mgmt 131M Sep/30/13

Updated weekly as of Nov/16/13

TOP EXECUTIVE HOLDERS

Insider Name Role# DirectShares Value

ReportedDate

Ellison, Lawrence Jo... CEO 1.11B 38.8B Oct/03/13Berg, Jeffrey S D 56,499 1.97M Oct/18/12Kurian, Thomas O 32,327 1.13M Oct/28/13Fowler, John F O 19,987 0.70M Aug/03/12Catz, Safra A P 12,535 0.44M Jul/17/13

Updated monthly as of Nov/17/13




SAMPLE

STOCKREPORTS+

DETAILED STOCK REPORT TIPS The Thomson Reuters Stock Report is a comprehensive, company-specific analysis that includes a proprietary Stock Rating along with underlying component indicators and supportive data elements. The report is updated daily, although some of the data elements and the ratings are updated weekly. Average Score The Average Score combines a quantitative analysis of six widely-used investment decision making tools - Earnings, Fundamental, Relative Valuation, Risk, Price Momentum, and Insider Trading. First, a simple average of the six underlying component ratings is calculated. Then, a normal distribution is used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. A score of 8 to 10 is considered positive, 4 to 7 is neutral, and 1 to 3 is negative. These six factors may be evaluated differently using alternative methodologies, and the importance of individual factors varies across groups, market capitalization and investment styles. Additional criteria should always be used to evaluate a stock. A company must have sufficient data available for at least four of the six component indicators in order to receive an overall Average Score. Approximately 85% of the stocks within the coverage universe meet the criteria to generate a score. Optimized Score As an alternative to the average score, the Stock Report includes an Optimized Score generated by independent research firm, Verus Analytics. It uses the same six component ratings, but rather than equally weighting each of the factors, the weighting varies by market capitalization of the underlying security based on backtesting research. These scores are also updated weekly and distributed normally on a 1 to 10 scale, with 10 being best. The variable size is assigned monthly by ranking the market capitalization and assigning the appropriate category as follows:

Large - Top 5.55% Mid - Next 13.87% Small - Next 34.68% Micro - Remaining 45.9%

Indicator Components The six indicators that comprise the stock rating are displayed. Like the stock rating, the component rating scale is 1 to 10, with 10 being best. A company will receive an ‘NR’ for No Rating if the required data elements or criteria are not met. A detailed section for each component is included in the report. Indicator Trends Within each component section, historical score trends are displayed, typically using a 4-week moving average over a timeframe of the past three years. The dotted orange line indicates the average of the scores over those three years. The most recent occurrence of the best and worst scores are also displayed on the chart in grey boxes to put the current score into historical context. Next to the trend chart for the company, current score averages are included, along with peer company comparisons of values from 6 months ago, 3 months ago, 1 month ago, the most recent value from 1 week ago, and the current score. The four closest industry peers are presented based on similar market capitalization.

Peer Analysis The Thomson Reuters Business Classification (TRBC) system is used for

industry comparisons. It is designed to track and display the primary business of a corporation by grouping together correlated companies that offer products and services into similar end markets. The system includes 10 Economic Sectors, 28 Business Sectors, 54 Industry Groups, and 136 Industries.

The Peer Analysis section of the report compares the company to its ten closest peers. The peers are selected from the industry based on similar market capitalization. The peer listing may have fewer than ten companies if there are fewer than ten companies classified within that industry.

Highlights The Thomson Reuters proprietary automated text-generation system creates highlights summarizing the most noteworthy data. The bullets will vary by company and will change from week to week as different criteria are met. Earnings The Earnings Rating is based on a combination of three factors: earnings surprises, estimate revisions, and recommendation changes. Each factor is equally weighted. Then, equal deciles are used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. A stock needs to have at least two of the three earnings factors in order to receive a score.

Earnings Surprises - The number of positive and negative surprises within the last 4 quarters.

Estimate Revisions - The number of up and down revisions and the average percentage change of those revisions within a 4 week period.

Recommendation Changes - The number of broker upgrades and downgrades in the last 120 days.

Price Target The price target is based on the predictions of analysts covering the stock and shows the high, low and mean price expected within the next 12 months. Earnings Per Share The quarterly and annual earnings per share are presented when available, along with the mean, high and low. Quarterly data is displayed for the past 4 quarters (actual) and the next 2 quarters (estimated). Annual data is displayed for the past 2 years (actual) and the next 2 years (estimated). Mean Estimate Trend The mean estimates show how the consensus has changed over the past 30 days and 90 days for the upcoming two quarters and two years. The percentage change is calculated for the company as a means for comparison by measuring the difference between the current consensus estimate and that of 90 days ago. Analyst Recommendations The Thomson Reuters I/B/E/S Mean is the mean recommendation of all analysts covering the stock. The recommendations are presented on a five-point standardized scale: strong buy, buy, hold, reduce, and sell. Earnings Surprises The surprise summary includes the total number of quarters (and percentage) in

the past 12 quarters in which earnings surprises were positive, negative, or in-line. In order to be recognized as a positive or negative surprise, the percent must be greater than 2% above or 2% below the consensus, respectively.

The surprise detail section includes a listing of the company's quarterly earnings reported for the most recent 6 quarters. The consensus analyst estimate is provided to determine if the actual earnings report represented a positive surprise, negative surprise, or in-line result.

Fundamental The Fundamental Rating is based on a combination of four factors: profitability, debt, earnings quality, and dividend. Companies that do not pay a dividend are not penalized. Each factor is equally weighted. Then, equal deciles are used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. A stock needs to have at least three of the four fundamental factors present for a given fiscal quarter in order to receive a score. Profitability is comprised of four data elements. Revenue Growth: (Net Sales – Previous Net Sales) / Previous Net Sales Gross Margin: Gross Profit / Net Sales Return on Equity: Net Income / Total Equity Net Margin: Net Profit / Net Sales

Debt is comprised of four data elements. Current Ratio: Current Assets / Current Liabilities Debt-to-Capital: Total Debt / Total Capital Interest Funding: Interest Expense / Operating Cash Flow Interest Coverage: (Pre-Tax Income + Interest Expense) / Interest Expense

Earnings Quality is comprised of two data elements. Days Sales in Inventory: 365 / (Cost of Goods Sold / Inventory) Days Sales in Receivables: 365 / (Net Sales (Revenues) / Receivables)

Dividend is comprised of four data elements. The company must have a current dividend yield. Dividend Growth Rate: (Dividends per Share – Previous Dividends per Share)

/ Previous Dividends per Share Dividend Funding: Dividends / Operating Cash Flow Dividend Coverage: (Pre-Tax Income + Interest Expense) / (Interest Expense

+ Dividends) Dividend Yield: Annual Dividends per Share / Current Market Price per Share

Indicator Trend The fundamental indicator trend displays quarterly scores over the past three years. The best and worst scores over that timeframe can be easily determined from the values shown on the chart for each quarter.




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Relative Valuation The Relative Valuation Rating is based on a combination of three factors: Forward PEG (50% weight), Trailing P/E (25% weight), and Forward P/E (25% weight). After the weightings are considered to combine individual factors, equal deciles are used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. These common valuation metrics are evaluated against the overall market, the index, and the company's own historic 5-year averages. A stock needs to have at least one of the three relative valuation factors in order to receive a score. Trailing P/E: Close Price / Most Recent 4 Quarters of Earnings Forward P/E: Close Price/ Upcoming 4 Quarters of Earnings Forward PEG: Forward P/E / Long-Term Forecasted Growth Rate

Valuation Averages Negative values are excluded when calculating the averages. A maximum value of 100 is placed on Trailing P/E and Forward P/E, a maximum value of 5 is placed on Forward PEG, and a maximum value of 20 is placed on Price to Sales when calculating the averages. Higher values are rounded down to the maximum for the averages. Valuation Multiples The valuation multiples provide the Trailing P/E, Forward P/E, Forward PEG, and Price to Sales for the company and the S&P 500 index average. In addition, a comparison of the current company’s values to its 5-year average and an industry average are presented. A discount occurs when the company’s ratio is valued more favorably (lower) than that to which it is compared. Risk The Risk Rating displays stocks on a scale of 1 to 10 with 10 being awarded to the least risky stocks. It is derived by looking at a series of long-term (5-year) and short-term (90-day) stock performance measures including volatility, magnitude of returns, beta, and correlation. Each factor is equally weighted. Then, equal deciles are used to rank each stock across the market. A stock needs to have at least two of the four risk factors in order to receive a score. Magnitude of Returns – The best / worst daily returns in the past 90 days and the

best / worst monthly returns in the past 60 months. Volatility – The standard deviation of the stock price over the last 90 days and

last 60 months, along with the average and largest intra-day stock swing. Beta – Measures the tendency of a security’s returns to respond to swings in the

market, based on the beta of the company versus the relevant index. Correlation – Determines how closely the returns of the stock and the relevant

index move together, measured over the last 90 days and last 60 months. Risk Analysis Price analysis for the company and the S&P 500 is provided over two time periods. Daily analysis is provided for the last 90 days, whereas monthly statistics are used for the last 60 months. Price Momentum The Price Momentum Rating is based on a combination of two technical performance factors: relative strength (70% weight) and seasonality (30% weight). After the weightings are considered to combine individual factors, equal deciles are used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. A stock needs to have data for the relative strength factor in order to receive a score. Relative Strength – The relative strength of the company for the last 1 month, 3

months, and 6 months on a scale of 1 to 100. Seasonality – The average monthly return (price performance) for the current

month and next 2 months for the company and industry, over the past 10 years. A lower industry rank indicates a higher return.

Price Performance Daily close prices are used to calculate the price performance of the stock. The performance of the S&P 500 is also displayed as a means of comparison. Insider Trading The Insider Trading Rating is based on short-term (60% weight) and long-term (40% weight) legal insider trading behavior. After the weightings are considered to combine individual factors, a function similar to a normal distribution is used to rank each stock across the market on a scale of 1 to 10, with 10 being most favorable. A stock needs to have at least one of the two insider trading factors in order to receive a score. Short-Term Insider – Uses insider buy and sell transactions within the past 90

days. This factor is based on the Thomson Reuters quantitative insider trading model that considers the insider's role, consensus, number of shares, market capitalization of the company, and the historic stock performance following trades by the given insider.

Long-Term Insider – Looks at buying, selling and option exercise decisions over the past six months relative to other stocks within the same business sector. The net shares are presented alongside the business sector average as a means of comparison.

Monthly Buys and Sells The total market value of open-market buying and selling is displayed by month in the chart for easy comparison. Transactions by trusts and corporations are excluded, along with buys greater than $10 million and sales greater than $50 million. Transactions for the exercise of derivatives and option exercises are excluded from the totals. Institutional Holders The top five institutional holders of the company are listed in descending order, based on their total share holdings. Possible values for the institution type include Brokerage, Funds, Inv Mgmt, or Strategic. Executive Holders The top five executive insiders of the company are listed in descending order, based on their total direct common share holdings (options are not considered). Indirect holdings are excluded, as the owner may not actually have investment discretion over these shares. This table is updated monthly. Insiders who have not filed any transactions or holdings over the past two years are excluded as this may indicate that the individual is no longer associated with the company. Additionally, direct shares held must be greater than 1,000 to be considered. Insider Roles AF - Affiliate O - Officer B - Beneficial Owner OH - Other CB - Chairman P - President CEO - Chief Executive Officer R - Retired CFO - Chief Financial Officer SH - Shareholder CM - Committee Member SVP - Senior Vice President CO - Chief Operating Officer T - Trustee CT - Chief Technology Officer TR - Treasurer D - Director VC - Vice Chairman EVP - Exec Vice President VP - Vice President GC - General Counsel

DISCLAIMER All information in this report is assumed to be accurate to the best of our ability. Past performance is not a guarantee of future results. The information contained in this report is not to be construed as advice and should not be confused as any sort of advice. Thomson Reuters, its employees, officers or affiliates, in some instances, have long or short positions or holdings in the securities or other related investments of companies mentioned herein. Investors should consider this report as only a single factor in making their investment decision.




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oracle corporation (orcl-n) detailed stock report · 2015-02-12 · 5.7 average 53.75 3.2% 7.8%...

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