Oracle, a company that is well-known for its cloud systems, beat forecasts with their flat stock. The company by the name Wall Street predicted a relatively bright future for Oracle, and despite their fiscal third-quarter earnings, they failed to get a lift. Still, the company exceeded the expectations from the experts, thanks to their revenue and buyback strategy.
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Table of Contents
Oracle’s Revenue Decline
A famous analyst, Keith Bachman from BMO Capital Markets said that he’s doubtful when it comes to Oracle’s revenue-growth rates. His target price is still at $53, although Oracle is far from it. Taking a good look at their revenue, we can see a decrease of 1% YoY to $9.62 billion in the third quarter. Even with the decline, FactSet predicted a total of $9.58 million, meaning that Oracle has exceeded the expectations. If we exclude the impact of the currency exchange rates, Oracle’s revenue in the aforementioned period rose 3%. That’s still not that impressive.
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Predictions for the Fourth Quarter
What does the fourth quarter bring to Oracle? Well, the management team said that fourth-quarter revenue will go as flat as 2%. To be precise, in the range of $11.3 to $11.26 billion. As for Oracle’s buyback tactics, the company spent a huge amount of money there. With about $10 billion spent, they gained a total of $29.9 billion in a period of nine months.
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The Current State of Oracle
According to Barrons, Oracle’s business will definitely grow but it requires some patience from investors. The good news is that it’s stable and that investors will have a good reason to invest in Oracle. This is confirmed by Marshall Senk, a Rosenblatt Securities analyst, who has a specific target share price of $51. As it now stands, Oracle saw a major improvement in 2019, with their stock being 18% higher than in 2018. Of course, their share is around $53.16 at the, as predicted by many analysts, which means good news for Oracle.
