What to Expect When Oracle Reports After the Close

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Oracle Corp. (NYSE: ORCL) is set to report its fiscal second-quarter financial results after the markets close on Thursday. The analysts’ consensus forecast calls for $0.88 in earnings per share (EPS) and $9.65 billion in revenue. In the same period of last year, the tech giant said it had $0.80 in EPS and $9.6 billion in revenue.

Following Oracle’s analyst meeting in September, Wedbush reiterated a Neutral rating with a $55 price target. The firm said that it remains on the sidelines looking for meaningful progress in rebooting database growth (either cloud/autonomous or BYOL) on a more sustained basis.

Wedbush noted that Oracle positions itself as the only company that can provide a fully integrated stack that includes infrastructure, autonomous database, applications and artificial intelligence. Wedbush is more convinced of Oracle’s progress in cloud applications than cloud infrastructure, as management’s expectations for noticeable progress continue to be dashed by lumpy quarterly performance and relatively flat infrastructure revenue.

In the report, Wedbush detailed:

Oracle has transitioned nearly 100% of its applications to the cloud, and this week’s product and partnership announcements are uniformly focused on cloud. Now, ORCL is using itself as its main reference for cloud prospects with a series of programs called Oracle@Oracle. Also, Oracle has a large base of customer references for each application and it working to transition customers’ entire application + database stacks to Oracle Cloud. Since acquiring NetSuite, Oracle has expanded NetSuite to 30+ countries, 50+ new industries, and delivered 32% ERP growth (FY19). Oracle added AI/ML capabilities in nearly every app category (sales, marketing, supply chain, financials, HR).

Excluding Wednesday’s move, Oracle had performed roughly in line with the broad markets, the stock is up about 25% year to date. In the past 52 weeks, the stock was up roughly 21%.

A few other analysts weighed in on Oracle ahead of the report:

  • Argus has a Buy rating.
  • Sanford Bernstein has a Buy rating and a $66 price target.
  • UBS Group has a Neutral rating and a $57 price target.
  • Goldman Sachs rates it as Buy with a $62 price target.
  • Barclays has an Equal Weight and a target price of $57.
  • BMO Capital Markets rates it Market Perform and a target of $60.
  • JPMorgan has a Neutral rating with a $56 target price.
  • RBC has a Neutral rating and a $57 target price.
  • Credit Suisse has a Buy rating with a $62 target price.

Shares of Oracle traded at $56.03 on Thursday, in a 52-week range of $42.40 to $60.50. The consensus price target is $56.27.

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