Oracle Presents an Interesting Opportunity – Morgan Stanley
2022.06.06 20:21
Oracle (ORCL) Presents an Interesting Opportunity – Morgan Stanley
By Sam Boughedda
Morgan Stanley analyst Keith Weiss reiterated an Equal Weight rating and $88 price target on Oracle (NYSE:ORCL) Monday, stating that the shares present an interesting opportunity.
Asking the question of whether Oracle is a “safe(er) ship in stormy seas,” the analyst wrote that increased confidence in the underlying drivers of a modest revenue acceleration in FY23, along with expectations for OM to sustain above pre-pandemic levels, make them believe the risk-reward at Oracle presents an “interesting opportunity on a relative basis.”
“With shares outperforming thus far this year, the debate on the stock has shifted to whether there is still room left to run in the value trade at Oracle,” wrote Weiss. “At reasonable valuations (short duration assets) are seen as a relatively safe harbor as investors navigate a period of rising interest rates and multiple compression across software.”
“From that perspective, we’d argue that Oracle presents an interesting opportunity for better-than-expected EPS growth in a choppy marketplace,” he added.
Weiss sees positive data points on the momentum of the core business at Oracle, resulting in the belief that the shares adequately discount the uncertainties.
Oracle is expected to report its fourth-quarter results on June 13, 2022.
