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Oracle (ORCL) Stock Sinks As Market Gains: What You Should Know

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Zacks Equity Research
·3 min read
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In the latest trading session, Oracle (ORCL) closed at $62.70, marking a -0.9% move from the previous day. This change lagged the S&P 500's daily gain of 0.17%. At the same time, the Dow lost 0.02%, and the tech-heavy Nasdaq gained 0.38%.

Coming into today, shares of the software maker had gained 1.95% in the past month. In that same time, the Computer and Technology sector gained 8.01%, while the S&P 500 gained 2.33%.

ORCL will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.11, up 14.43% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $10.06 billion, up 2.64% from the year-ago period.

ORCL's full-year Zacks Consensus Estimates are calling for earnings of $4.34 per share and revenue of $40.02 billion. These results would represent year-over-year changes of +12.73% and +2.42%, respectively.

It is also important to note the recent changes to analyst estimates for ORCL. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.21% higher. ORCL currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that ORCL has a Forward P/E ratio of 14.56 right now. Its industry sports an average Forward P/E of 39.93, so we one might conclude that ORCL is trading at a discount comparatively.

We can also see that ORCL currently has a PEG ratio of 1.32. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computer - Software was holding an average PEG ratio of 3.01 at yesterday's closing price.

The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 207, putting it in the bottom 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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