Reviewing Oracle (ORCL) & Apptio (NASDAQ:APTI)

Apptio (NASDAQ: APTI) and Oracle (NYSE:ORCL) are both technology companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, profitability, dividends and institutional ownership.

Dividends

Oracle pays an annual dividend of $0.76 per share and has a dividend yield of 1.5%. Apptio does not pay a dividend. Oracle pays out 32.6% of its earnings in the form of a dividend. Oracle has increased its dividend for 6 consecutive years.

Valuation & Earnings

This table compares Apptio and Oracle’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Apptio $160.57 million 6.14 -$31.55 million ($0.68) -35.91
Oracle $37.73 billion 5.43 $9.34 billion $2.33 21.25

Oracle has higher revenue and earnings than Apptio. Apptio is trading at a lower price-to-earnings ratio than Oracle, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Apptio and Oracle’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apptio -14.77% -36.83% -13.78%
Oracle 25.48% 20.49% 8.38%

Institutional and Insider Ownership

45.6% of Apptio shares are held by institutional investors. Comparatively, 57.9% of Oracle shares are held by institutional investors. 43.2% of Apptio shares are held by company insiders. Comparatively, 29.0% of Oracle shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent recommendations for Apptio and Oracle, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apptio 0 1 7 0 2.88
Oracle 0 9 26 0 2.74

Apptio currently has a consensus price target of $25.00, suggesting a potential upside of 2.38%. Oracle has a consensus price target of $55.39, suggesting a potential upside of 11.88%. Given Oracle’s higher possible upside, analysts clearly believe Oracle is more favorable than Apptio.

Summary

Oracle beats Apptio on 12 of the 16 factors compared between the two stocks.

Apptio Company Profile

Apptio, Inc. is a provider of technology business management (TBM) solutions. The Company’s cloud-based platform and software as a service (SaaS) applications enable information technology (IT) leaders to analyze, optimize and plan technology investments, and benchmark the financial and operational performance against peers. It operates in the United States, the United Kingdom, Germany, Denmark, the Netherlands, Australia, Canada, France and Singapore. Its TBM solutions consist of a cloud-based platform and SaaS applications, which include Cost Transparency, IT Benchmarking, Business Insights, Bill of IT and IT Planning. It serves a range of industries, including financial services, professional services, technology, energy, consumer goods, manufacturing, healthcare, media, retail and transportation, as well as federal and state government agencies. Its cloud-based data and analytics platform aggregates, cleanses and correlates customer data from a range of disparate sources.

Oracle Company Profile

Oracle Corporation (Oracle) provides products and services that address all aspects of corporate information technology (IT) environments, including application, platform and infrastructure. The Company’s businesses include cloud and on-premise software, hardware and services. Its cloud and on-premise software business consists of three segments, including cloud software and on-premise software, which includes Software as a Service (SaaS) and Platform as a Service (PaaS) offerings, cloud infrastructure as a service (IaaS) and software license updates and product support. Its hardware business consists of two segments, including hardware products and hardware support. The Company’s services business includes the remainder of the Company’s segments. Its services business includes activities, such as consulting services, enhanced support services and education services, among others.

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