Friday, August 26, 2011

Analysts Predict Oracle Will Fall

Business software and hardware maker Oracle (NASDAQ: ORCL ) has had a pretty
good run since in 1986 IPO its stock is up about 40,000% from the
split-adjusted eight cents it traded at back then. Does it still have further to
run? One things for sure investors are increasing their bets that Oracle stock
is going to fall. How so? As of Aug. 15, Oracle stock ranked fourth on the list
of top 50 increases in short interest on the Nasdaq from the previous two weeks.
Specifically, short interest in Oracle stock is up 57% to 34.6 million shares
from the period ending July 29. In its second quarter, Oracle beat expectations.
It reported 75 cents per share four cents ahead of expectations . But its
revenues of $10.8 billion only met expectations, and its hardware sales from
its purchase of Sun Microsystems fell 6%. Although those sales make up only
about 10% of its total revenues, Oracle stock fell 6% in after-hours trading on
the earnings announcement. Is the rise in Oracle short interest related to
expected bad news on hardware sales when it reports its third-quarter results
next month? Does this mean you should avoid the stock? Here are three reasons to
consider buying it: Good quarterly earnings. Oracle has been able to surpass
analysts' expectations in

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