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Oracle (ORCL) Gains But Lags Market: What You Should Know

Oracle (ORCL) closed at $89.45 in the latest trading session, marking a +0.11% move from the prior day.

This story originally appeared on Zacks

Oracle (ORCL) closed at $89.45 in the latest trading session, marking a +0.11% move from the prior day. This change lagged the S&P 500's 0.43% gain on the day.

- Zacks

Heading into today, shares of the software maker had gained 2.54% over the past month, lagging the Computer and Technology sector's gain of 4.49% and the S&P 500's gain of 2.56% in that time.

Wall Street will be looking for positivity from ORCL as it approaches its next earnings report date. In that report, analysts expect ORCL to post earnings of $0.97 per share. This would mark year-over-year growth of 4.3%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $9.77 billion, up 4.28% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.63 per share and revenue of $42.27 billion, which would represent changes of -0.86% and +4.43%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ORCL. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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. Within the past 30 days, our consensus EPS projection has moved 0.3% lower. ORCL is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note ORCL's current valuation metrics, including its Forward P/E ratio of 19.28. Its industry sports an average Forward P/E of 37.65, so we one might conclude that ORCL is trading at a discount comparatively.

Also, we should mention that ORCL has a PEG ratio of 2.27. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Software industry currently had an average PEG ratio of 3.05 as of yesterday's close.

The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 170, putting it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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