Oracle (ORCL, $77.22) shares fall, on lower-than-expected guidance
Oracle shares dropped -5% in extended trading on Tuesday, despite earnings beat. It provided a lower-than-expected guidance on quarterly revenue. The computer tech company also expressed plans to boost capital expenditures for cloud computing workloads.
Adjusted earnings for the fiscal fourth quarter came in at $1.54 per share, beating the $1.31 per share expected by analysts, according to Refinitiv.
Revenue for the quarter rose +8% year-over-year (vs. +3% in the prior quarter) to $11.23 billion, compared to $11.04 billion as expected by analysts (according to Refinitiv). Revenue growth got a boost from base effect since the prior-year quarter revenue fell around -6% amid the coronavirus pandemic.
Revenue from the cloud services and license support business was $7.39 billion, up +8% and above the FactSet consensus estimate of $7.32 billion. According to the company, revenue from its second-generation cloud infrastructure doubled in the quarter.
The cloud license and on-premises license segment generated $2.14 billion in revenue, growing +9% and beating consensus estimate of $2.05 billion.
The company’s hardware revenue fell -2% to $882 million, in line with analysts’ estimates.
Looking ahead, Oracle is expecting adjusted earnings of 94 cents to 98 cents in per share for the fiscal first quarter, vs. $1.03 per share projected by analysts polled by Refinitiv. The company forecasts 3% to 5% revenue growth for that quarter, vs. 3% revenue growth estimated by analysts surveyed by Refinitiv.
According to Oracle, it expects to roughly double its cloud capex spending in FY 2022 to nearly $4 billion. “We are confident that the increased return in the cloud business more than justifies this increased investment, and our margins will expand over time,” CEO Safra Catz said.
Momentum Indicator for ORCL turns positive, indicating new upward trend
ORCL saw its Momentum Indicator move above the 0 level on October 04, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 81 similar instances where the indicator turned positive. In of the 81 cases, the stock moved higher in the following days. The odds of a move higher are at .
Technical Analysis (Indicators)
Bullish Trend Analysis
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where ORCL advanced for three days, in of 349 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 324 cases where ORCL Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The 10-day RSI Indicator for ORCL moved out of overbought territory on October 10, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 47 similar instances where the indicator moved out of overbought territory. In of the 47 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 3 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
The Moving Average Convergence Divergence Histogram (MACD) for ORCL turned negative on October 01, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 44 similar instances when the indicator turned negative. In of the 44 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ORCL declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
ORCL broke above its upper Bollinger Band on October 08, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Fundamental Analysis (Ratings)
Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 76%.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating outstanding price growth. ORCL’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 88, placing this stock better than average.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (61.350) is normal, around the industry mean (30.829). P/E Ratio (33.108) is within average values for comparable stocks, (161.895). Projected Growth (PEG Ratio) (1.057) is also within normal values, averaging (2.738). Dividend Yield (0.013) settles around the average of (0.083) among similar stocks. P/S Ratio (6.720) is also within normal values, averaging (56.664).
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a developer of a diversified line of business software products
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