Head to Head Analysis: Oracle (ORCL) versus Apptio (APTI)

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

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. Apptio has increased its dividend for 6 consecutive years.

Institutional & Insider Ownership

57.9% of Oracle shares are owned by institutional investors. Comparatively, 45.6% of Apptio shares are owned by institutional investors. 29.0% of Oracle shares are owned by company insiders. Comparatively, 43.2% of Apptio shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Oracle and Apptio’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Oracle $37.73 billion 5.43 $9.34 billion $2.33 21.25
Apptio $160.57 million 6.14 -$31.55 million ($0.69) -35.39

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.

Volatility and Risk

Oracle has a beta of 1.05, suggesting that its share price is 5% more volatile than the S&P 500. Comparatively, Apptio has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Oracle and Apptio, as reported by MarketBeat.com.

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

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

Profitability

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

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

Summary

Oracle beats Apptio on 11 of the 16 factors compared between the two stocks.

About Oracle

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.

About Apptio

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.

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