From Robbie Stephens: Oracle Corporation
(Nasdaq: ORCL) $23.13
Long-Term Attractive
Eric Upin, Business-to-Business eCommerce
"This week, Oracle is hosting AppsWorld, a user conference focused on the company's 11i applications suite, in New Orleans," said Upin. The five-day event features presentations by Oracle executives, customers, and partners, as well as product demonstrations and topical break-out sessions. The company held a similar event in Paris last week. Thus far, there have been no major new customer or product announcements. However, management provided updated 11i metrics, including: 1) 2,500 signed customers 2) 180 live customers and 3) progress of Oracle's internal roll-out of 11i. However, we believe the 11i product cycle is still relatively early in terms of functionality, market adoption, live implementations, and customer references. At an analyst briefing on Tuesday evening, CFO Jeff Henley maintained his positive outlook and guidance of 75% year/year growth in applications and 15-20% year/year growth in database servers for both the February and May quarters. Although Oracle has executed well on its compelling vision thus far, we believe there is risk to the numbers over the near-term given the aggressive ramp in application licenses in the May quarter, coupled with greater macroeconomic uncertainty and the early stages of the company's major new product cycle. Therefore, we maintain our Long-Term Attractive rating on the stock at this time." |
