The trailing 12-month revenue-per-share line and year-over-year diluted quarterly EPS growth correlate well with the stock's price performance. If Oracle can't exceed the analyst community's estimated expectations concerning these two metrics, a price pullback wouldn't be surprising.
These factors are the main drivers for both revenue and EPS growth. The other key driver is the continuing upgrades and improvements its product-development teams continue to make on its existing product line. For example, one of the best-selling products is its PeopleSoft suite of applications. On Monday, the company announced its latest version, PeopleSoft 9.2. To its credit, Oracle demonstrates its commitment to continue to invest in PeopleSoft by including more than 1,000 new features, functions and enhancements in PeopleSoft 9.2. The details and benefits of this best-yet version can be found in the news release. Paco Aubrejuan, senior vice president and general manager of Oracle's PeopleSoft applications, summed up this app upgrade by writing: "With revolutionary innovations in user experience, Oracle's PeopleSoft 9.2 has new features and functionality designed to help users work more efficiently, get their work done quicker, and in a way that's more familiar based on consumer technologies. And, with dramatic improvements in operational cost management, we believe Oracle's PeopleSoft 9.2 is a game-changing release." This may be one of the reasons that Oppenheimer reiterated its "outperform" rating for Oracle and raised its price target from $37 to $40. The analysts' consensus 1-year price target is slightly above $38 a share. I tend to agree with TheStreet Ratings' outlook for Oracle and am looking for a $40 price target and possibly a little higher. We'll be listening for clues and future guidance from management on its 5 p.m. ET conference call on Wednesday. Overly cautious guidance going forward might precipitate a temporary share-price correction, and that, my friends, may offer an attractive entry point for those waiting for the price to come to them. Disclosure: As of the time of publication, the author wasn't long shares of any of the companies mentioned in this article. Follow @m8a2r1 This article was written by an independent contributor, separate from TheStreet's regular news coverage.