Oracle Corporation (ORCL) vs Tapestry, Inc. (TPR): Which Is the Better Buy in 2026?
As of 2026-11-01, ORCL is undervalued at $131, with a DCF intrinsic value of $385 and a margin of safety of 66%. TPR is undervalued at $116, with an intrinsic value of $200 and a margin of safety of 42%. Of the two, ORCL has the wider margin of safety.
Rewards
- ★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.
- ★Gross margin of 76.6% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Tapestry, Inc. scores 77/100 on the Economic Moat Score (Wide Moat), with reinvestment efficiency as the strongest competitive dimension.
- ★Free cash flow has grown at a 31.8% CAGR over the past 4 years, demonstrating strong earnings power growth.
Risks
- ⚠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.
- ⚠FCF yield of 6.1% suggests reasonable valuation assuming continued moderate growth.
- ⚠High leverage (4.05x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
- ⚠Insiders have sold $4.3M worth of stock in the past 3 months — significant insider liquidation.
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.
What growth rate is the market pricing in at $116?
The market implies +5.0% Owner Earnings growth, roughly in line with history — reasonably priced.
Standard FCF implies +6.7%, reflecting ongoing growth investment.
Economic Moat Score
Learn more →Narrow moat with revenue predictability as the key competitive advantage. Improving reinvestment efficiency would strengthen the moat.
Wide moat with strength across all dimensions. Reinvestment Efficiency is the standout factor.
Forensic Accounting
Learn more →M-Score Trend
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: ORCL vs TPR
Is Oracle Corporation or Tapestry, Inc. 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 TPR's 42.0% margin of safety (intrinsic $200 vs. $116).
Which stock has a wider economic moat, Oracle Corporation or Tapestry, Inc.?▼
TPR scores 77/100 (Wide moat), while ORCL scores 67/100 (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. TPR scores 4.0 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which company has better free cash flow, Oracle Corporation or Tapestry, Inc.?▼
Tapestry, Inc. (TPR) generates a 6.1% free cash flow yield, compared to Oracle Corporation's -11.6%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Oracle Corporation or Tapestry, Inc.?▼
TPR earns 27.0% ROIC versus ORCL's 8.5%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.
Which dividend is safer, Oracle Corporation's or Tapestry, Inc.'s?▼
TPR's dividend earns a safety score of 94/100 (Very Safe), compared to ORCL's 79/100 (Safe). TPR has raised its dividend for 3 consecutive years.