On January 18, Oracle Financial Services Software, an IT stock in the midcap basket, delivered exceptional returns of 30% to investors in a single day. Despite the bearish trend in the market, Oracle not only touched a new 52-week high but also stood out as a top-performing stock on both BSE and NSE.

Oracle’s surge can be attributed to its robust performance in Q3 for FY24, making it a consensus “strong buy” among analysts.

Bullish Trend Continues:

Oracle’s bullish trend extended over two consecutive days, witnessing a climb of Rs 1,701.6 or 34.64% from January 17-18. The stock has shown an impressive growth of 121% from its 52-week low of Rs 2,987.40 on BSE, currently holding a market cap of Rs 56,705.52 crore.

Generous Dividends and Financial Highlights:

Oracle stands out with a substantial dividend yield of 3.44%, one of the highest among IT stocks. Over the last 12 months, it has distributed a remarkable 4500% dividend, amounting to Rs 225 per share. The company has a consistent track record of rewarding shareholders with dividends for the past five years.

Q3FY24 Financial Performance:

In Q3FY24, Oracle reported impressive consolidated figures:

• Revenue: Rs. 1,824 Crore, up 26% YoY
• Operating Income: Rs. 840 Crore, up 45% YoY
• Net Income: Rs. 741 Crore, up 69% YoY

Segment-wise Performance:

• Products business: Revenue of Rs. 1,680 Crore, up 29% YoY
• Services business: Revenue of Rs. 144 Crore, down 2% YoY

Fundamentals:

• Market Cap ₹ 60,983 Cr.
• Current Price ₹ 7,039
• High / Low ₹ 7,139 / 2,987
• Face Value₹ 5.00
• Book Value ₹ 750
• Dividend Yield 3.16 %
• Industry PE 38.7
• Stock P/E 28.6
• PEG Ratio 3.62
• Return over 1year 111 %
• ROCE 35.1 %
• ROE 24.8 %
• Sales growth 12.6 %
• Profit growth 18.2 %
• Profit Var 3Yrs 7.30 %
• Sales growth 3Years 5.44 %
• OPM 43.5 %
• Debt ₹ 53.8 Cr.
• Debt to equity 0.01
• Free Cash Flow ₹ 1,720 Cr.
• Int Coverage 134
• Cash Equivalents ₹ 4,406 Cr.

Key Positive Factors for Investors:

• Return on Equity (ROE) for the last financial year: 24.21%
• Stock Price Growth: 110.15%, outperforming the sector by 72% in the past year
• Debt-to-Equity Ratio: Zero, indicating a debt-free status
• Mutual Fund Holding: Increased by 1.16% in the last quarter to 4.94
• Interest Coverage Ratio: 210.45, comfortably meeting interest payments with earnings
• Price to Earning Ratio: 26.52, lower than sector PE ratio of 64.34
• Promoter Pledges: Zero

Global Recognition and Future Outlook:

Oracle Financial Services Software, a world leader in financial services products and services, is a majority-owned subsidiary of Oracle Corporation. The company has a consensus “strong buy” recommendation from analysts, and its EPS is expected to grow by 24.5% in FY24.

Expert Opinion and Outlook:

According to Trendlyne data, Oracle Financial Services Software is well-regarded by analysts, and the company’s solid financials indicate positive growth. With a strong Q3 performance and a robust deal pipeline, Oracle is poised for continued success in serving the market with its produc