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Technology Stocks : Oracle Corporation (ORCL) -- Ignore unavailable to you. Want to Upgrade?

To: ray who wrote (11713)	9/13/1999 11:02:00 PM
From: Sarkie	Read Replies (1) \| Respond to of 19079

Don't know if any one posted this but a great commentary from EarningsWhisper Don't be too surprised if Oracle (ORCL) beats estimates of $0.16 and the Earnings Whisper of $0.18. The company has a long history of surprising by two or three cents, and it appears that Oracle is again purposely manipulating the analysts' estimates so it can surprise. On August 22nd, Oracle CEO Larry Ellison said that the current quarter "looks good" for the company and then suggested to analysts that they should not be too optimistic since a majority of the company's sales come at the end of the quarter. Most analysts followed Ellison's advice by saying they believed the company was inline to meet or exceed their estimates. Joseph Farley at DLJ cautioned of lower sales due to a sales staff reorganization a week earlier. That, along with Ellison's comments, resulted in little market expectation. Since then the company has had a chance to see the exact quarterly sales figures and the stock has jumped $10 amid rumors that sales in August were much greater than expected and that the company won some application contracts, but did not announce them. This brings the revenue expectation to $2.2 billion, nearly $200 million more than most analysts are officially expecting. In addition, with the company's cost reductions, the improved profit margin is expected to result in earnings above the $0.16 consensus estimate and potentially above the $0.18 Earnings Whisper number. The recent $10 increase is the largest price gain since the company beat estimates and Earnings Whispers last quarter. This will also be the second straight quarter that the company manipulated the analysts estimates so they may surprise. Last quarter, Oracle convinced analysts they would have another tight quarter. When Oracle surprised the analysts by beating both the whispers and the estimates, the stock increased over $6 the following day. In contrast, two quarters ago, Oracle reported earnings a penny above the consensus estimate, but two cents below the Earnings Whisper number. The stock dropped $8 the next day. The question now is whether or not the market has caught on to Oracle's earnings game and whether the surprise will be big enough to support the $10 run up during the past two weeks after the sales rumors spread. One factor to consider is that most analysts expect Oracle's earnings report to show a clear trend of revenue shifting into the Internet market while maintaining database sales - resulting in higher revenue growth. You may listen to Oracle's conference call on the Internet at nasdaq-amex.com beginning at 5:30 PM EST.