The California-based provider of enterprise software and computer hardware products and services shows "persistent sales issues offset by product momentum," analysts said.
"While we believe that broader deployment of the company's latest release of its flagship database 12c will lead to a positive inflection point in exadata and drive overall database growth, the company does face secular pressure in its traditional hardware and applications businesses, as well as faces go-to-market strategy and execution concerns," analysts added.
Shares of Oracle are up 0.56% to $41.15 in pre-market trading.
Separately, TheStreet Ratings team rates ORACLE CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate ORACLE CORP (ORCL) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, reasonable valuation levels, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- ORCL's revenue growth trails the industry average of 28.1%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The gross profit margin for ORACLE CORP is currently very high, coming in at 82.31%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 25.40% is above that of the industry average.
- ORACLE CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, ORACLE CORP increased its bottom line by earning $2.39 versus $2.26 in the prior year. This year, the market expects an improvement in earnings ($3.04 versus $2.39).
- You can view the full analysis from the report here: ORCL Ratings Report