Oracle Corporation (ORCL) Beats on Earnings But Cloud Growth Still Slow

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Shares of Oracle Corporation (NYSE:ORCL) are down slightly in pre-market trading this morning as the company reported their fiscal second quarter numbers after the market closed yesterday. Overall the numbers were good, with the company posting an EPS for the quarter of $0.63, which beat consensus numbers by $0.03. They just missed on Revenue, reporting $9 billion, while analysts were expecting $9.06 billion. With this said, the stock is likely in the red this morning because of the rather lackluster 31% cloud growth that Oracle Corporation (NYSE:ORCL) reported, a number which they beleive will jump higher in future quarters.

“We are still on-target to sell and book more than $1.5 billion of new SaaS and PaaS business this fiscal year,” the chairman Ellison said in a statement along with the earnings release. “That is considerably more SaaS and PaaS new business than any other cloud services provider including Salesforce.com.”

The stock closed at $38.91 during the last trading session. It is down 12.33% since May 14, 2015 and is downtrending. It has underperformed the S&P500 by 8.65%.

From a total of 13 analysts covering Oracle (NYSE:ORCL) stock, 8 rate it a “Buy”, 0 a “Sell”, and 5 a “Hold”. This means that 62% of the ratings are positive. The highest target price is $50 while the lowest target price is $43. The mean of all analyst targets is $45.11 which is 15.93% above today’s ($38.91) stock price. Oracle was the topic of 14 analyst reports since July 30, 2015 according to the firm StockzIntelligence Inc. Goldman Sachs upgraded shares on November 16 to a “Conviction Buy” rating. BTIG Research initiated shares with a”Buy” rating and a $44 target share price in their report from a September 10. FBR Capital downgraded ORCL stock in a recent report from November 5 to a “Mkt Perform” rating. Finally, JMP Securities downgraded the stock to a “Mkt Perform” rating in a report they issued on an October 14.

The institutional sentiment decreased to 0.72 in Q2 2015. It’s down 0.15, from 0.87 in 2015Q2. The ratio fall, as 130 funds sold all their Oracle Corporation shares they owned while 622 reduced their positions. 67 funds bought stakes while 471 increased their total positions. Institutions now own 2.29 billion shares which is 9.81% less than the previous share count of 2.54 billion in 2015Q2.

Black Creek Investment Management Inc. holds 12.2% of its total portfolio in Oracle Corporation, equating to 2.57 million shares. Caledonia Investments Plc owns 862,500 shares representing 11.21% of their total US portfolio. Moreover, Mountain Lake Investment Management Llc has 9.09% of their total portfolio invested in the company, equating to 312,500 shares. The Alabama-based Vulcan Value Partners Llc has a total of 8.17% of their portfolio invested in the stock. Veritas Investment Management Llp, a United Kingdom-based fund reported 983,915 shares owned.

Oracle Corporation is a provider of enterprise software and computer hardware products, and services. The company has a market cap of $165.94 billion. The Company’s offerings include Oracle database and middleware software, application software, cloud infrastructure, hardware systems including computer server, storage and networking products, and related services. It has 18.28 P/E ratio.

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