UBS Reiterates Buy on Oracle (ORCL) Following 4Q Earnings Report
UBS reiterated a Buy rating and $44.00 price target on Oracle (NYSE: ORCL) following the company's 4Q earnings report. ORCL reported revenues of $10.596B, coming in ahead of the Street's $10.46B estimate. EPS missed estimates of $0.82 by 1c.
Analyst Brent Thill commented, "Headline revs $10.596B beat St's $10.46B in all rev segments, with the exception of new software license $2.77B (-10% y/y), which fell modestly below consensus $2.8B. The upside was offset by higher opex resulting in the ~130bps OPM miss (45%) and resulting EPS 1c below St's 82c despite 1c less of a headwind than in guide. While arguably better than feared, the larger concern for us was ORCL's $574M SaaS/PaaS ARR bookings ($601M including IaaS, a net new disclosed portion this Q) missing the $1.5B FY16 SaaS/PaaS ARR target by $140M, and which went unaddressed. With this leading future business indicator missing (lofty) expectations and absence of guided commentary around FY17 ARR targets, we think the above consensus total rev guide (+2-5% vs. St's +2%) and SaaS/PaaS rev growth guide (75-80% vs. prior 59%+ guide and St's +61% though admittedly did not include recent OPWR, TXTR deals) is unlikely to provide a NT reprieve in shares."
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Shares of Oracle closed at $38.64 yesterday.