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Technology Stocks : Oracle Corporation (ORCL)
ORCL 193.64-4.2%Jan 14 3:59 PM EST
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To: Joe Waynick who wrote (16061)8/20/2001 3:33:46 PM
From: MeDroogies  Read Replies (2) of 19080
 
The rest of the investment community sees a slowdown in capital expenditures and tech spending. There's the assumption that ORCL can't maintain previous rates of increase in the areas which you point to.
And with good reason. I don't doubt that some of these areas will have reductions in their rate of increase. Some areas, such as margins, are likely to decrease.

This is considered a "bad thing". However, my feeling is the LE has set ORCL up very nicely for just this turn of events. While there is likely to be slowdowns and reductions, ORCL has positioned itself to take advantage of just this type of market.

Ultimately, a stock is priced on its ability to turn a profit. All other factors play important roles in helping a company achieve that goal, but in the end...it is the profit that matters. While I'd prefer to see ORCL earn $1 a share with a 50% margin (just making numbers up here....), I don't have a problem with them earning $1.05 per share with a 25% margin, especially if their competitors begin to show losses or even bigger problems.

ORCL did the bulk of their cost cutting BEFORE the markets turned sour, and they have continued their aggressive stance in the difficult environment. I consider these things positives. There are many who don't...and there are people who will, and are welcome to, take shots at my simplified view of the overall situation.
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