In a report published Friday, Morgan Stanley analyst Keith Weiss reiterated an Overweight rating on Oracle ORCL, but lowered the price target from $39.00 to $36.00.
In the report, Morgan Stanley noted, “While an improvement from Q3, 1% organic cc license growth fell below investor's expectations for the seasonally strong ORCL Q4. Mgmt cited; 1) macro slowdown in APAC (down 7% cc), 2) weakness in traditional and vertical apps, and 3) transition impacts from the shift to sub. rev for the lower sales productivity in the quarter. An anemic license growth profile likely pressures the multiple in the near-term, however an improving dividend (up 100% YoY), an additional $12B in repurchase authorization, and strong intrinsic value support from the recurring revenue base (we estimate a $28/share value of the base plus cash) should limit downside in the shares.”
Oracle closed on Thursday at $33.21.
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