Oracle Corporation (ORCL) Falling In After-Hours Activity

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Oracle Corporation ( ORCL) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Oracle Corporation as such a stock due to the following factors:

  • ORCL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $543.4 million.
  • ORCL is down 5% today from today's close.

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More details on ORCL:

Oracle Corporation develops, manufactures, markets, hosts, and supports database and middleware software, application software, cloud infrastructure, hardware systems, and related services worldwide. The stock currently has a dividend yield of 1.4%. ORCL has a PE ratio of 18. Currently there are 16 analysts that rate Oracle Corporation a buy, 2 analysts rate it a sell, and 9 rate it a hold.

The average volume for Oracle Corporation has been 11.7 million shares per day over the past 30 days. Oracle has a market cap of $190.9 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.16 and a short float of 0.6% with 1.63 days to cover. Shares are down 0.7% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Oracle Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year and expanding profit margins. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • ORCL's revenue growth has slightly outpaced the industry average of 5.0%. Since the same quarter one year prior, revenues slightly increased by 0.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • ORACLE CORP reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. 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 ($2.86 versus $2.39).
  • ORCL's debt-to-equity ratio of 0.67 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.48 is very high and demonstrates very strong liquidity.
  • 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. 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.

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