Rimini Street, Inc. (RMNI) stock intrinsic value fair value estimate & owner earnings analysis

Rimini Street sells subscription support for enterprise software (Oracle, SAP, VMware and others) as a cheaper alternative to the software vendors' own support. At the end of 2025 it served over 3,100 active clients, including 78 Fortune 500 companies. Revenue was $421.5 million in 2025, down from $428.8 million in 2024 and $431.5 million in 2023, and about 88% of subscription revenue from existing clients is retained each year. What we count as earnings. We measure cash from operations, remove swings in working capital, and subtract stock-based pay and the capital spending needed to keep the business running. On that basis the last four years were $0.04, $0.38, $0.20 and $0.16 per share for 2022 through 2025. The 2024 and 2025 figures are cleaned for one Oracle-related item: in late 2024 Rimini paid Oracle about $58.7 million of court-awarded legal fees, and in July 2025 it got about $37.9 million of that back under a settlement. Before cleaning, those years read -$0.45 and $0.56. We used a 2022 to 2025 window and take the median, about $0.18 per share (roughly $17 million a year). We did not use the 2019 to 2021 years because operating profit before litigation has fallen from about $53.5 million in 2023 to $32.5 million in 2024 and $28.5 million in 2025. Cleaning the two Oracle years by the full amounts, without a tax adjustment, is an approximation. In the first half of 2026, cash from operations was $22.9 million versus $15.9 million a year earlier, which is encouraging but is not enough on its own to change the level. The key fact: the Oracle PeopleSoft wind-down. Under the July 2025 settlement, Rimini must stop supporting Oracle PeopleSoft products by July 31, 2028. Those products were about 8% of 2024 revenue and about 5% of 2025 revenue (roughly $21 million). Annualized PeopleSoft subscription revenue was already down to about $15 million at the end of 2025, from about $31 million a year earlier. The remaining loss is contractual, not a forecast. Gross profit fell $6.4 million in 2025 on $7.2 million less revenue, so lost revenue appears to fall almost entirely on profit; gross margin is about 60%. Rimini may also owe refunds or buy-out fees to end contracts early, and its liquidated-damages exposure to clients is up to $8.2 million. A breach of the settlement could let Oracle restart the litigation. Base case, about $0.80 per share. Earnings start from the $17 million level and shrink as PeopleSoft revenue runs off, to about $13 million in 2026, $9.5 million in 2027 and $6.5 million in 2028 (about $6.3 million a year afterwards), then hold flat through 2035. Year one is below the last actual year's cleaned earnings growth of about -20% only in that it assumes a somewhat larger drop, so no reversal of the slowdown is assumed. Beyond 2035 nothing specific supports growth, so earnings fade 10% a year. We credit no growth: non-PeopleSoft annualized subscription revenue rose from $384 million to $396 million in 2025, but that is one year, and non-PeopleSoft subscription revenue for the year was flat ($380 million versus $382 million), so it does not yet qualify. New products and AI services are left out as well. Bear case, about $0.11 per share. Profit margins are thin, so small revenue losses matter. In 2025 U.S. revenue fell 8% ($210.0 million to $193.0 million). In this case PeopleSoft exits with refunds and buy-outs, U.S. weakness spreads, and earnings fall to $8 million in 2026, $3 million in 2027 and zero from 2028. The company also has a term loan with about $52.5 million due in 2029 (balance was $69.4 million at end of 2025), so a business earning nothing would struggle to refinance. Debt is not subtracted from value directly; it shows up in this weak case. Bull case, about $2.19 per share. Growth in non-PeopleSoft subscriptions continues to offset the PeopleSoft run-off, so earnings hold near $17 million for ten years and then fade 5% a year. What would make us wrong: a faster or slower PeopleSoft run-off than assumed, cost cuts that offset lost revenue (upside), or a sharp drop in retention below 88% (downside). Because this is a thin-margin business in a forced wind-down, the margin-of-safety price is set at a large discount to the base case, below $0.40.