Oracle (ORCL) closed at $219.86 in the latest trading session, marking a -1.34% move from the prior day. The stock trailed the S&P 500, which registered a daily loss of 0.92%. Meanwhile, the Dow experienced a drop of 1.18%, and the technology-dominated Nasdaq saw a decrease of 0.84%.
The stock of software maker has fallen by 23.5% in the past month, lagging the Computer and Technology sector's gain of 1.64% and the S&P 500's gain of 1.48%.
The investment community will be paying close attention to the earnings performance of Oracle in its upcoming release. The company's earnings per share (EPS) are projected to be $1.63, reflecting a 10.88% increase from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $16.15 billion, indicating a 14.84% growth compared to the corresponding quarter of the prior year.
ORCL's full-year Zacks Consensus Estimates are calling for earnings of $6.8 per share and revenue of $66.89 billion. These results would represent year-over-year changes of +12.77% and +16.53%, respectively.
It is also important to note the recent changes to analyst estimates for Oracle. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.37% higher. Oracle currently has a Zacks Rank of #3 (Hold).
In terms of valuation, Oracle is currently trading at a Forward P/E ratio of 32.77. For comparison, its industry has an average Forward P/E of 23.03, which means Oracle is trading at a premium to the group.
It's also important to note that ORCL currently trades at a PEG ratio of 1.91. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Computer - Software industry was having an average PEG ratio of 1.85.
The Computer - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 53, positioning it in the top 22% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Oracle Corporation (ORCL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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