Oracle’s Q4 Beats Expectations but Outlook Doesn’t Surprise; Shares Fairly Valued

Oracle’s fourth quarter was rosier than expected with earnings per share exceeding the high end of management's guidance, as customer cloud consumption revenue growth grew at a robust pace, exceeding 100%. Nonetheless, the outlook was not a surprise—leading to only moderate long-term forecast boosts as a result, on our end. While also considering the time value of money from rolling our model, we are increasing our fair value estimate for the narrow-moat stock to $67 from $63 per share. This leaves the negative-trend company fairly valued, with shares trading near $73 in after hours.