Oracle Rallies; Waiting Out the Storm in Redwood Shores

Oracle (ORCL) shares today have rallied impressively following last night’s better-than-expected results for its fiscal third quarter ended in February. The analysts who track the stock were generally impressed with the numbers; I would note that is the same crew that had been cutting expectations heading into the quarter. (Though even most of the estimate-cutters continued to recommend the stock.)

Guidance for the May quarter was below the consensus, although a few analysts asserted that they were likely in line with the “whisper” numbers expected by the buy side. Pacific Crest’s Brendan Barnicle points out that the Street seems to have been caught by surprise in terms of the strength of the company’s European business in the latest quarter; he notes that most analysts do their channel checks in North America, where business was slower.

Overall, the Street continues to view Oracle’s large installed base of maintenance-paying enterprise customers as a protective shield from the broader economic downturn; to many, Redwood Shores looks like a pretty good place to hide out from the storm.

Read the rest of this post