Adobe (NASDAQ:ADBE) vs. Oracle (NYSE:ORCL) Critical Survey

Adobe (NASDAQ:ADBE) and Oracle (NYSE:ORCL) are both large-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, risk and valuation.

Risk and Volatility

Adobe has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500. Comparatively, Oracle has a beta of 1.65, meaning that its stock price is 65% more volatile than the S&P 500.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Adobe	$23.77 billion	3.47	$7.13 billion	$17.48	11.67
Oracle	$67.36 billion	7.86	$17.09 billion	$5.83	31.56

Oracle has higher revenue and earnings than Adobe. Adobe 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 Adobe and Oracle’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Adobe	28.69%	65.11%	25.60%
Oracle	25.37%	56.43%	8.36%

Institutional & Insider Ownership

81.8% of Adobe shares are held by institutional investors. Comparatively, 42.4% of Oracle shares are held by institutional investors. 0.2% of Adobe shares are held by company insiders. Comparatively, 40.9% of Oracle shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and target prices for Adobe and Oracle, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Adobe	5	20	5	1	2.06
Oracle	1	8	28	3	2.83

Adobe currently has a consensus price target of $278.16, indicating a potential upside of 36.34%. Oracle has a consensus price target of $268.27, indicating a potential upside of 45.79%. Given Oracle’s stronger consensus rating and higher possible upside, analysts plainly believe Oracle is more favorable than Adobe.

Summary

Oracle beats Adobe on 10 of the 15 factors compared between the two stocks.

About Adobe

Adobe Inc., together with its subsidiaries, operates as a diversified software company worldwide. It operates through three segments: Digital Media, Digital Experience, and Publishing and Advertising. The Digital Media segment offers products, services, and solutions that enable individuals, teams, and enterprises to create, publish, and promote content; and Document Cloud, a unified cloud-based document services platform. Its flagship product is Creative Cloud, a subscription service that allows members to access its creative products. This segment serves content creators, students, workers, marketers, educators, enthusiasts, and communicators. The Digital Experience segment provides an integrated platform and set of applications and services that enable brands and businesses to create, manage, execute, measure, monetize, and optimize customer experiences from analytics to commerce. This segment serves marketers, advertisers, agencies, publishers, merchandisers, merchants, web analysts, data scientists, developers, and executives across the C-suite. The Publishing and Advertising segment offers products and services, such as e-learning solutions, technical document publishing, web conferencing, document and forms platform, web application development, and high-end printing, as well as Advertising Cloud offerings. It also provides consulting, technical support, and learning services. The company offers its products and services directly to enterprise customers through its sales force and local field offices, as well as to end users through app stores and through its website at adobe.com. It also distributes products and services through distributors, value-added resellers, systems integrators, software vendors and developers, retailers, and original equipment manufacturers. The company was formerly known as Adobe Systems Incorporated and changed its name to Adobe Inc. in October 2018. Adobe Inc. was founded in 1982 and is headquartered in San Jose, California.

About Oracle

Oracle Corporation offers products and services that address enterprise information technology environments worldwide. Its Oracle cloud software as a service offering include various cloud software applications, including Oracle Fusion cloud enterprise resource planning (ERP), Oracle Fusion cloud enterprise performance management, Oracle Fusion cloud supply chain and manufacturing management, Oracle Fusion cloud human capital management, Oracle Cerner healthcare, Oracle Advertising, and NetSuite applications suite, as well as Oracle Fusion Sales, Service, and Marketing. The company also offers cloud-based industry solutions for various industries; Oracle application licenses; and Oracle license support services. In addition, it provides cloud and license business' infrastructure technologies, such as the Oracle Database and MySQL Database; Java, a software development language; and middleware, including development tools and others. The company's cloud and license business' infrastructure technologies also comprise cloud-based compute, storage, and networking capabilities; and Oracle autonomous database, MySQL HeatWave, Internet-of-Things, digital assistant, and blockchain. Further, it provides hardware products and other hardware-related software offerings, including Oracle engineered systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software, and related hardware services; and consulting and customer services. The company markets and sells its cloud, license, hardware, support, and services offerings directly to businesses in various industries, government agencies, and educational institutions, as well as through indirect channels. The company has a collaboration with Amdocs Limited to empower customers on their journey towards cloud and digital adoption. Oracle Corporation was founded in 1977 and is headquartered in Austin, Texas.