On Thursday night, we'll get a first-quarter 2008 update from enterprise software architect Oracle
What analysts say:
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Buy, sell, or waffle? Thrity-seven analysts hearken to Oracle's tidings. Twenty-four of them have a buy rating on the stock; 12 are content to hold; and one rebel wants to sell. In our Motley Fool CAPS database, this is a four-star stock these days, based on input from more than 1,330 investors like you and me.
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Revenues. $4.34 billion would keep the average analyst happy, and that would be a 19% increase from the year-ago period's $3.66 billion.
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Earnings. The consensus forecast calls for $0.21 per share, up from $0.18 per share a year ago.
What management says:
In the fourth-quarter report, CFO Safra Katz said that "If you have the right strategy and the best technology it will show up in your results. The numbers speak for themselves."
OK, so let's have a look at some numbers.
What management does:
This is a remarkably steady combination of earnings growth on autopilot and stable margins. Oracle also generates copious amounts of free cash flow, which tends to be invested in major acquisitions that form the basis of the company's growth.
2/2006 |
5/2006 |
8/2006 |
11/2006 |
2/2007 |
5/2007 |
|
---|---|---|---|---|---|---|
Gross |
77.2% |
77.5% |
77% |
76.6% |
76.5% |
76.7% |
Operating |
34.2% |
34.5% |
34.1% |
33.7% |
33.5% |
34.1% |
Net |
23.1% |
23.5% |
23.2% |
23% |
23.3% |
23.7% |
FCF/Revenue |
27.3% |
29.9% |
29.4% |
27.3% |
27.8% |
28.9% |
Y-O-Y Growth |
2/2006 |
5/2006 |
8/2006 |
11/2006 |
2/2007 |
5/2007 |
---|---|---|---|---|---|---|
Revenue |
21.9% |
21.9% |
23.1% |
24.7% |
26.9% |
25.1% |
Earnings |
8.7% |
17.2% |
22% |
28.6% |
27.9% |
26.4% |
One Fool says:
Of course, the management team said a lot more than just "look at the numbers" last time around. You could say that the Oracle leaders have developed a habit of thumbing their noses at the competition at every opportunity.
Between the earnings release and the attendant conference call, these guys managed to get in digs on IBM's
There was no mention of Red Hat
Not that two companies with more than a $5 billion market cap combined could hurt mighty Oracle too badly, but the silence is still interesting. Maybe we'll hear a wisecrack or two about them this time.