Robinhood Markets, Inc. (HOOD) vs Oracle Corporation (ORCL): Which Is the Better Buy in 2026?
As of 2026-11-02, HOOD is undervalued at $85, with a DCF intrinsic value of $164 and a margin of safety of 48%. ORCL is undervalued at $131, with an intrinsic value of $385 and a margin of safety of 66%. Of the two, ORCL has the wider margin of safety.
Rewards
- ★Gross margin of 91.0% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Each dollar of retained earnings has created $11.86 of earning power — management is an exceptional capital allocator.
- ★Gross margin of 64.0% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Return on equity has consistently exceeded 20% over 4 years, indicating efficient use of shareholder capital.
- ★Each dollar of retained earnings has created $3.80 of earning power — management is an exceptional capital allocator.
Risks
- ⚠Despite buyback spending, shares outstanding increased in 2 out of 3 years — stock-based compensation is offsetting repurchases.
- ⚠Beneish M-Score of -1.59 flags financial patterns consistent with potential earnings manipulation — warrants further investigation.
- ⚠9 insider sales totaling $112.6M with no purchases in the past 3 months — insiders are reducing their exposure.
- ⚠Despite buyback spending, shares outstanding increased in 3 out of 4 years — stock-based compensation is offsetting repurchases.
- ⚠High leverage (1.97x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
- ⚠Altman Z-Score of 1.57 places the company in the distress zone — financial patterns resemble those of companies that experienced bankruptcy.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →Requires positive FCF to compute implied growth rate.
Requires positive FCF to compute implied growth rate.
Economic Moat Score
Learn more →Narrow moat with reinvestment efficiency as the key competitive advantage. Improving roic consistency would strengthen the moat.
Narrow moat with revenue predictability as the key competitive advantage. Improving reinvestment efficiency would strengthen the moat.
Forensic Accounting
Learn more →M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is pessimistic — investigate whether fears are temporary or structural"
"Market is pessimistic — investigate whether fears are temporary or structural"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: HOOD vs ORCL
Is Robinhood Markets, Inc. or Oracle Corporation more undervalued in 2026?▼
Based on our discounted cash flow model, ORCL trades at a 66.0% margin of safety (intrinsic value $385 vs. price $131), compared to HOOD's 48.2% margin of safety (intrinsic $164 vs. $85).
Which stock has a wider economic moat, Robinhood Markets, Inc. or Oracle Corporation?▼
ORCL scores 67/100 (Narrow moat), while HOOD scores 45/100 (Narrow moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is Oracle Corporation in financial distress?▼
ORCL's Altman Z-Score of 1.6 places it in the Distress zone, signaling elevated bankruptcy risk. HOOD scores 2.6 (Grey zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which stock has higher return on invested capital, Robinhood Markets, Inc. or Oracle Corporation?▼
ORCL earns 8.5% ROIC versus HOOD's 5.9%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.
Does Robinhood Markets, Inc. have accounting red flags?▼
HOOD's Beneish M-Score of -1.6 flags it as a likely earnings manipulator (above the -1.78 threshold). By contrast, ORCL scores -2.6, within the normal range. The Beneish model detects aggressive accounting through eight financial ratios.