Buy This MNC IT Stock That Has Declared 3800% Dividend, Valuations Cheap

Oracle Financial Services has reported a very good set of quarterly numbers and the board of the company has also declared a good dividend of 3800% or Rs 190 per share on the face value is Rs 5.

Buy the stock for its strong dividend yields, cheap valuations

The stock is available at a dividend yield of nearly 5.86%, on a share price of Rs 3430. We believe that the company would continue to declare similar dividends in the years to come, which makes the stock attractive for its dividend yield. Now coming to the valuations bit, the company reported an EPS of Rs 218 for FY 2022. This means the stock which is trading at Rs 3430 is barely valued at 15.71 times.

Most IT stocks even the mid-sized ones are are trading at p/e of 25 to 30 times. This company is a subsidiary of Oracle Corporation and offers you dividend yields of close to 6%. The stock in our opinion is relatively cheap given the order book as well of the company. We see earnings visibility, stable margins, good dividend and cheap valuations as some of the reasons to but this IT Stock. Unlike many companies that are facing inflation pressures, we do not see margin pressures as much. Overall, the stock is a good buy for long-term investors.

Good quarterly numbers from oracle financial services

The company is a majority owned subsidiary of Oracle. Net income for fiscal year 2022 was Rs. 1,889 Crore, up 7% compared to fiscal year 2021. Revenue for fiscal year 2022 was Rs. 5,221 Crore, up 5%compared to fiscal year 2021. Operating income for fiscal year 2022 was Rs. 2,394 Crore, up 2% compared to fiscal year 2021.

For the quarter ended March 31, 2022, the revenue was Rs. 1,277 Crore, up 5% year-over year; the operating income was Rs. 528 Crore, down 6% year-over-year; and the net income was Rs. 482 Crore, up 5% year-over-year.

For the full year ended March 31, 2022, the Products business posted revenue of Rs. 4,692 Crore, up 6% compared to fiscal year 2021, and operating income of Rs. 2,452 Crore, up 3% year-over-year. For the quarter ended March 31, 2022, the Products business posted revenue of Rs. 1,154 Crore, up 7% year-over-year and an operating income of 542 Crore down, 3% year-over-year.

Robust business prospects

The Company signed license deals of $ 29.5 million during the quarter with customers in 35 countries. Nine customers went live on Oracle Financial Services software products during the quarter. Headquartered in Singapore with operations in Singapore, China and Malaysia, Luminor Financial Holdings Limited is a financial solutions business that caters to SMEs across the region. The Company has signed a deal with Oracle to implement its Oracle Banking Supply Chain Finance Solution and supporting modules to address the needs of its customers in the region.

What was also interesting in the quarter was that net margins were 38% for the quarter, and 36% for the year ended March 31, 2022. Overall, the company reported a very good set of numbers.