Rosenblatt Starts Oracle (ORCL) at Buy
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Rosenblatt initiates coverage on Oracle (NYSE: ORCL) with a Buy rating and a price target of $48.00.
Analyst Marshall Senk commented, "We believe that Oracle has made it through the trough of its business transition to the cloud model and that the company is well positioned to see reacceleration in margins and continued acceleration in cloud momentum over the next several quarters. In particular we point to a strong product cycle (SaaS apps, the new PaaS offering and the 12c R2 database), sales programs that offer customers the flexibility to transition at their pace and an ongoing willingness to be aggressive in M&A to consolidate the market.
For F2017 we estimate $37 billion in total revenues and cloud revenues of $2.9 billion, respective growth of -3% and 37%. Our EPS estimate of $2.61 shows the impact of SaaS growth, as revenues are deferred and recognized over the life of the subscription. Strong growth in SaaS/PaaS is offset by the continued decline in the traditional software business, which we forecast to decline 1% and still comprises 70% of Oracle’s revenues. These numbers exclude the impact of the Netsuite (N:NR) acquisition, expected to close around year end."
Shares of Oracle closed at $41.13 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, New Coverage
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