Warning? Warning?

investmenttool.com Cover Story

The cliffhanger in California is not what happened to the character played by Rick Schroeder on NYPD Blue. It is not whether President Bartlett will run for re-election on the West Wing. Those cliffhangers may not be resolved until next January. The Oracle Cliffhanger is likely to work itself out in the next few days. Will they or wont they have an earnings warnings.

The score right now is that analysts all over the country have been lowering earnings estimates for Oracle Corporation. This is based on the widely held view that Oracle will not make consensus earnings for the fourth quarter which ended last Thursday.

Last March, Oracle issued an immediate warning on March 1, the day after their quarter ended. That has not happened, and the numbers crunchers are going to look things over this weekend and try and figure out what if anything to say.

In March, Oracle, which usually closes many deals on the last few days of the quarter knew right away based on which deals were closed whether or not they had a chance to make earnings. The stock fell through much of February, falling from a January peak of over $30 a share to as low as $13 in anticipation of the warning.

Is a warning a certainty? No, but I have thought it very likely because of the aggressive effort Oracle made to extort another $80,000 in revenue from my employer for a license we had already paid for. My theory was if they were this close to the bottom of the barrel, making numbers would be impossible.

The fact is, if they don't issue a warning the next few days, the stock will probably rise, because a warning is priced into the stock. That does not guarantee making consensus estimates of 14 cents a share, because accounting and tax rules could skew the figures.

So, nail biting time for oracle stockholders and speculators is now. What will come of it only the next few days will tell us.

For our front page, click here.

Shmuel Protter
investmenttool.com

Send this page to a friend

Friends Email (Required):
Your Email (Required)    :
Your Name (Required)    :

Enter your message to your friend (optional):

Return Email receipt: Yes No
Join Stockwatch Alert Mailing list: Yes No

---

Join Stockwatch Alert mailing list.

---

---