Software giant

Oracle

(ORCL) - Get Report

is well positioned to benefit from an economic recovery, according to a Merrill Lynch analyst who upgraded the company's investment rating Monday.

Analyst Jason Maynard believes the stock has limited downside, especially if the economy gradually improves. As a result, Maynard upped Oracle to buy from neutral and set a $15 price target. (Merrill intends to seek investment banking business from Oracle in the coming months.)

Maynard thinks the company is on track to reach 4% to 7% revenue growth in the current quarter, and he raised his top-line estimate to $2.12 billion from $2.07 billion. The analyst maintained his earnings estimate of 8 cents a share, which matches Wall Street's consensus estimate.

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Oracle's long-term growth rate, however, relies on the maturity of its core business, Maynard wrote in a research note. "As telecommunications, financial services and government spending start to break out of the doldrums, Oracle should stand to benefit as it generates about 40% of its revenue from those sectors," he wrote.

On Friday, Oracle said it

extended its tender offer to acquire rival

PeopleSoft

(PSFT)

until Sept. 19.

Shares of Oracle were climbing 1.1% in premarket trading to $11.51.