What to Watch When Oracle Releases Earnings

By Chris Lange Updated Jan 6, 2:35AM EST · Published Sep 11, 12:50PM EDT

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What to Watch When Oracle Releases Earnings — © maybefalse / Getty Images

Oracle Corp. (NYSE: ORCL) is set to report its fiscal first-quarter financial results after the markets close on Thursday. The analysts’ consensus forecast calls for $0.81 in earnings per share (EPS) and $9.29 billion in revenue. In the same period of last year, the tech giant said it had $0.71 in EPS and $9.2 billion in revenue.

Back in the fiscal fourth quarter, Oracle said that its total quarterly revenues increased by 1%, and by 4% in constant currency, compared to the same period a year earlier. Cloud services and license support revenues totaled $6.8 billion, while cloud license and on-premise license revenues were $2.5 billion. Total cloud services and license support plus cloud license and on-premise license revenues were $9.3 billion, up 3% in U.S. dollars and 6% in constant currency.

Analysts came out in response. At that time, Merrill Lynch reiterated a Neutral rating for the stock but raised its price objective to $60 from $57. The brokerage firm detailed in its report:

Autonomous DB [database] encouraging, but still waiting for SaaS [Software as a service] … we would have liked to see better performance in cloud services and license support, which continued to decelerate to 3% year over year in constant currency, implying sustained flat/deceleration in cloud SaaS/PaaS/IaaS and/or maintenance. Moreover, total we believe revs would need to accelerate to mid-high single digits for the stock to rerate – 5-6% organic software rev growth will require SaaS/PaaS/IaaS growth of 35-40% (from SaaS at 15-20%; PaaS/IaaS at low 20s today), which will be challenging.

Excluding Wednesday’s move, Oracle had outperformed the broad markets, with the stock up about 3% year to date. In the past 52 weeks, the stock was up roughly 19%.

[nativounit]

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

Cowen has a Buy rating with a $65 price target.
William Blair has a Market Perform rating.
Raymond James has an Outperform rating and a $61 target.
Wedbush’s Neutral rating comes with a $55 price target.
Wells Fargo has an Outperform rating and a $65 target price.
Barclays has an Equal Weight rating with a $59 price target.
Jefferies has a Buy rating with a $66 price target.
BMO Capital Markets rates it as Market Perform with a $59 target.

Shares of Oracle traded up nearly 1% on Wednesday to $55.90, in a 52-week range of $42.40 to $60.50. The consensus price target is $56.62.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.