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UPDATE: Piper Sandler Downgrades Oracle (ORCL) to Underweight

March 11, 2022 5:54 AM EST
Get Alerts ORCL Hot Sheet
Price: $83.35 -0.9%

Rating Summary:
    28 Buy, 31 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 2 | Down: 23 | New: 24
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(Updated - March 11, 2022 6:31 AM EST)

Piper Sandler analyst Brent Bracelin downgraded Oracle (NYSE: ORCL) from Neutral to Underweight with a price target of $70.00 (from $100.00).

The analyst comments "Oracle Cloud improved once again as growth rose to 24% y/y (vs. 22% last quarter). That said, we find it difficult to see how a cloud shift can sustain a clear path to doubledigit organic growth next year considering more than 70% of revenue is still tied to the traditional Oracle product categories where revenue declined by 1.6% y/y this quarter. Few companies have executed a cloud model transition without a hiccup, and the drag on FCF margins is well documented and could also temper multiple expansion going forward. Hence, we are lowering our rating on ORCL to Underweight and reducing our PT to $70. Relative to large-cap software peers with similar CY23 EV/FCF multiples, we prefer CRM, MSFT, and WDAY that have less near-term operating risk and higher FCF growth prospects."

For an analyst ratings summary and ratings history on Oracle click here. For more ratings news on Oracle click here.

Shares of Oracle closed at $76.65 yesterday.


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