Opinions
Ian Ainsworth
Oracle
ORCL-N
DON'T BUY
Oct 28, 2013
Stock price when the opinion was issued
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Hasn't had a chance to look closely at yesterday's earnings. Stock's at a 52-week, if not all-time, high today. Looks interesting, given the cloud space it's in. Not expensive at 2x PEG, with forward PE of 29-30x. Earnings growth rate ~16%.
Technically, meets his criteria. 200-day MA is trending higher, and price is above that. High beta, volatile.
Went into yesterday with a 6% position in his fund, now just above 8%. Probably won't trim until it gets between 9-10%. Backlog was 360% more than what was expected.
Views it same way as IBM. Both are legacy technology stocks. But then the light went on and they got into the cloud and data centres.
Premium contentOracle reported a revenue of 14.9B, which is a -6.1% change from the previous quarter. An increase in revenue typically indicates growing demand for the company's products or services. A decline in revenue can be concerning, as it might indicate reduced sales or challenges in the market. It's important to investigate further to understand the underlying causes. Social media mentions are up 217.5% in the past 24h.
Great company, strong position in databases. Companies find it hard to move away from them. The problem is that the DB business is fairly mature. Oracle is slow to adapt to the cloud, however they are also unsure how to deal with ‘Big Data’. Others are finding that the world is changing very rapidly. A solid company but the transition is going to start to eat into their growth. This does not qualify according to his growth criteria.