Muted Expectations for Oracle Earnings?

By Jon C. Ogg Published Jun 17, 1:05PM EDT

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Oracle Corp. (NYSE: ORCL) is expected to report earnings after the close of trading on Wednesday. The enterprise software giant has Thomson Reuters consensus estimates of $0.87 in earnings per share (EPS) on revenues of $10.95 billion. A year ago Oracle posted EPS of $0.92 and $11.33 billion in revenue.

24/7 Wall St. received additional data from WhisperNumber.com ahead of the report that Oracle’s EPS whisper number is $0.87, in line with the analysts’ estimate. This is a neutral confidence ranking from the WhisperNumber community. Still, Oracle has reported earnings short of the so-called whisper number in four of the past five quarters. Also seen was that earnings whispers range from a low of $0.84 to a high of $0.89. With a 59% positive surprise history (38 or 64 reports tracked). WhisperNumber.com said:

The strongest price movement of +1.4% comes within ten trading days when the company reports earnings that beat the whisper number, and +3.4% within thirty trading days when the company reports earnings that miss the whisper number.

There are several things to consider here. Oracle’s stock is valued at about 15.5 times estimated 2015 earnings. The company’s combined sales in Oracle’s cloud software, infrastructure and platform-as-a-service businesses were $527 million in the latest quarter, up about 29% from a year earlier.

Another issue to watch is that co-CEO Mark Hurd recently said Oracle intends to make about 95% of its services available over the Internet by mid-October. This compares to roughly 65% of Oracle’s products being on the cloud today.

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Analysts have had mixed calls of late. Deutsche Bank and Wunderlich recently had Hold ratings, while Piper Jaffray reiterated an Overweight rating, but the firm raised its price target to $54 from $49.

Oracle’s shares have been hugging about a $1.00 range around its 50-day moving average for most of the past three months or so. Its 50-day moving average is $43.78, and its 200-day moving average is down at $42.11.

Oracle shares were down 0.25% at $44.51 Wednesday, against range of $35.82 to $46.71 in the past 52-weeks. Analysts have a consensus price target of $46.50.

About the Author Jon C. Ogg →

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. a673b.bigscoots-temp.com.