Stock Analysis on Net

Oracle Corp. (NYSE:ORCL)

Return on Capital (ROC)

Microsoft Excel LibreOffice Calc

Return on Invested Capital (ROIC)

Oracle Corp., ROIC calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 14,348  10,144  10,943  4,255  10,264  10,298 
Invested capital2 81,745  87,978  72,089  72,343  78,705  65,186 
Performance Ratio
ROIC3 17.55% 11.53% 15.18% 5.88% 13.04% 15.80%
Benchmarks
ROIC, Competitors4
Accenture PLC 25.83% 26.30% 24.83% 25.00% 21.84% 34.18%
Adobe Inc. 29.44% 21.67% 19.74% 17.25% 22.06% 21.03%
Autodesk Inc. 14.55% 21.62% 0.93% -11.17% -9.45% 8.45%
Automatic Data Processing Inc. 23.00% 26.19% 24.20% 22.34% 23.56% 19.28%
Fidelity National Information Services Inc. 0.43% 0.77% 4.00% 2.68% 3.11%
Fiserv Inc. 2.87% 2.50% 13.35% 12.78% 12.27%
International Business Machines Corp. 3.50% 7.84% 8.46% 5.77% 10.53%
Intuit Inc. 17.64% 20.65% 34.71% 32.34% 36.84% 34.96%
Mastercard Inc. 34.94% 56.26% 51.15% 42.02% 40.06%
Microsoft Corp. 47.33% 44.49% 39.13% 20.13% 34.61% 52.25%
PayPal Holdings Inc. 14.96% 9.66% 10.31% 2.59% 8.64%
salesforce.com inc. 8.25% 5.13% 9.04% 9.45% 7.67% 8.95%
ServiceNow Inc. 20.51% 19.88% 15.78% 15.89% -10.81%
Visa Inc. 21.41% 18.58% 24.39% 19.20% 17.04% 11.54%

Based on: 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31), 10-K (reporting date: 2017-05-31), 10-K (reporting date: 2016-05-31).

1 NOPAT. See details »

2 Invested capital. See details »

3 2021 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 14,348 ÷ 81,745 = 17.55%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Oracle Corp. ROIC deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level.

Decomposition of ROIC

Oracle Corp., decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
May 31, 2021 17.55% = 40.03% × 0.51 × 86.72%
May 31, 2020 11.53% = 34.29% × 0.44 × 76.58%
May 31, 2019 15.18% = 34.21% × 0.55 × 80.80%
May 31, 2018 5.88% = 35.42% × 0.55 × 29.99%
May 31, 2017 13.04% = 34.66% × 0.49 × 77.18%
May 31, 2016 15.80% = 35.32% × 0.58 × 77.53%

Based on: 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31), 10-K (reporting date: 2017-05-31), 10-K (reporting date: 2016-05-31).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the increase in return on invested capital (ROIC) over 2021 year is the increase in profitability measured by operating profit margin (OPM) ratio.


Operating Profit Margin (OPM)

Oracle Corp., OPM calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 14,348  10,144  10,943  4,255  10,264  10,298 
Add: Cash operating taxes2 2,197  3,101  2,600  9,932  3,034  2,984 
Net operating profit before taxes (NOPBT) 16,545  13,245  13,542  14,187  13,298  13,282 
 
Revenues 40,479  39,068  39,506  39,831  37,728  37,047 
Add: Increase (decrease) in deferred revenues 855  (444) 77  219  644  553 
Adjusted revenues 41,334  38,624  39,583  40,050  38,372  37,600 
Profitability Ratio
OPM3 40.03% 34.29% 34.21% 35.42% 34.66% 35.32%
Benchmarks
OPM, Competitors4
Accenture PLC 16.65% 16.59% 14.89% 14.07% 12.99% 16.91%
Adobe Inc. 40.89% 34.42% 31.93% 35.32% 33.91% 31.32%
Autodesk Inc. 23.23% 30.50% 3.88% -13.37% -9.48% 13.40%
Automatic Data Processing Inc. 22.37% 22.01% 21.27% 16.45% 20.71% 19.44%
Fidelity National Information Services Inc. 5.60% 8.35% 15.31% 15.46% 14.87%
Fiserv Inc. 13.42% 17.56% 28.43% 28.56% 29.21%
International Business Machines Corp. 9.78% 16.43% 14.56% 16.13% 16.19%
Intuit Inc. 28.02% 29.42% 28.33% 25.71% 28.07% 29.36%
Mastercard Inc. 53.66% 58.58% 48.97% 53.01% 52.93%
Microsoft Corp. 43.49% 38.29% 36.61% 35.11% 31.99% 30.09%
PayPal Holdings Inc. 24.50% 16.58% 14.93% 16.31% 14.53%
salesforce.com inc. 20.31% 15.74% 19.31% 16.41% 15.28% 15.60%
ServiceNow Inc. 17.81% 14.97% 14.28% 13.97% -7.00%
Visa Inc. 65.79% 64.63% 65.53% 62.93% 66.29% 55.52%

Based on: 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31), 10-K (reporting date: 2017-05-31), 10-K (reporting date: 2016-05-31).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2021 Calculation
OPM = 100 × NOPBT ÷ Adjusted revenues
= 100 × 16,545 ÷ 41,334 = 40.03%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. Oracle Corp. OPM improved from 2019 to 2020 and from 2020 to 2021.

Turnover of Capital (TO)

Oracle Corp., TO calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016
Selected Financial Data (US$ in millions)
Revenues 40,479  39,068  39,506  39,831  37,728  37,047 
Add: Increase (decrease) in deferred revenues 855  (444) 77  219  644  553 
Adjusted revenues 41,334  38,624  39,583  40,050  38,372  37,600 
 
Invested capital1 81,745  87,978  72,089  72,343  78,705  65,186 
Efficiency Ratio
TO2 0.51 0.44 0.55 0.55 0.49 0.58
Benchmarks
TO, Competitors3
Accenture PLC 1.95 1.97 2.16 2.38 2.33 2.52
Adobe Inc. 0.80 0.70 0.67 0.61 0.77 0.77
Autodesk Inc. 0.72 0.76 0.61 0.69 0.67 0.79
Automatic Data Processing Inc. 1.48 1.52 1.49 1.83 1.65 1.48
Fidelity National Information Services Inc. 0.17 0.14 0.38 0.40 0.39
Fiserv Inc. 0.25 0.17 0.57 0.63 0.63
International Business Machines Corp. 0.58 0.59 0.71 0.73 0.75
Intuit Inc. 0.79 0.89 1.50 1.50 1.80 1.77
Mastercard Inc. 0.78 1.15 1.34 1.29 1.06
Microsoft Corp. 1.25 1.38 1.38 1.44 1.27 1.91
PayPal Holdings Inc. 0.71 0.80 0.87 0.75 0.66
salesforce.com inc. 0.44 0.41 0.51 0.62 0.56 0.67
ServiceNow Inc. 1.22 1.36 1.18 1.24 1.33
Visa Inc. 0.40 0.36 0.45 0.43 0.36 0.32

Based on: 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31), 10-K (reporting date: 2017-05-31), 10-K (reporting date: 2016-05-31).

1 Invested capital. See details »

2 2021 Calculation
TO = Adjusted revenues ÷ Invested capital
= 41,334 ÷ 81,745 = 0.51

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. Oracle Corp. TO deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.

Effective Cash Tax Rate (CTR)

Oracle Corp., CTR calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2021 May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 14,348  10,144  10,943  4,255  10,264  10,298 
Add: Cash operating taxes2 2,197  3,101  2,600  9,932  3,034  2,984 
Net operating profit before taxes (NOPBT) 16,545  13,245  13,542  14,187  13,298  13,282 
Tax Rate
CTR3 13.28% 23.42% 19.20% 70.01% 22.82% 22.47%
Benchmarks
CTR, Competitors4
Accenture PLC 20.47% 19.34% 22.96% 25.38% 27.85% 19.91%
Adobe Inc. 10.28% 9.63% 7.06% 19.97% 15.15% 12.85%
Autodesk Inc. 13.48% 6.38% 60.79% 20.47%
Automatic Data Processing Inc. 30.37% 21.67% 23.76% 25.58% 30.95% 32.78%
Fidelity National Information Services Inc. 53.97% 33.45% 30.46% 57.05% 45.70%
Fiserv Inc. 13.84% 14.01% 17.87% 28.58% 33.04%
International Business Machines Corp. 37.71% 18.55% 18.30% 51.29% 13.24%
Intuit Inc. 20.15% 20.99% 18.37% 16.40% 27.07% 32.70%
Mastercard Inc. 16.35% 16.67% 21.83% 38.60% 28.53%
Microsoft Corp. 13.05% 15.80% 22.65% 60.11% 14.62% 9.05%
PayPal Holdings Inc. 13.86% 27.01% 20.58% 78.73% 10.06%
salesforce.com inc. 6.84% 19.81% 7.75% 7.69% 9.84% 13.86%
ServiceNow Inc. 5.88% 2.51% 6.49% 8.20%
Visa Inc. 17.90% 19.02% 17.44% 29.55% 28.46% 34.94%

Based on: 10-K (reporting date: 2021-05-31), 10-K (reporting date: 2020-05-31), 10-K (reporting date: 2019-05-31), 10-K (reporting date: 2018-05-31), 10-K (reporting date: 2017-05-31), 10-K (reporting date: 2016-05-31).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2021 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 2,197 ÷ 16,545 = 13.28%

4 Click competitor name to see calculations.

Tax rate Description The company
CTR Effective cash tax rate on operating income. Oracle Corp. CTR increased from 2019 to 2020 but then decreased significantly from 2020 to 2021.