
Oracle (ORCL) Stock Downgraded at Morgan Stanley
NEW YORK (TheStreet) -- Oracle (ORCL) - Get Report stock was downgraded to "equal weight" from "overweight" at Morgan Stanley on Wednesday morning.
The firm maintained its $45 price target on the stock.
Positive cloud bookings were unable to fuel the multiple expansion seen in other "cloud transition stories," Morgan Stanley said in a note.
Oracle struggled to translate its cloud bookings into revenue growth, faced a larger-than-expected impact on its income statement from its transition to the cloud and is uncertain about the significance and duration of those impacts, the firm adds.
Additionally, cloud revenue growth will likely contribute only 5% of the company's revenues in the quarter ended February 2016, according to Morgan Stanley.
Based in Redwood City, CA, Oracle is a provider of enterprise software as well as computer hardware products and services.
Shares of the company are flat in pre-market trading on Wednesdsay.
Separately, TheStreet Ratings team rates ORACLE CORP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
We rate ORACLE CORP (ORCL) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, increase in stock price during the past year and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- After a year of stock price fluctuations, the net result is that ORCL's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Software industry average. The net income has decreased by 20.0% when compared to the same quarter one year ago, dropping from $2,184.00 million to $1,747.00 million.
- Net operating cash flow has decreased to $5,856.00 million or 12.96% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, ORACLE CORP has marginally lower results.
- You can view the full analysis from the report here: ORCL
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.








