Oracle
The share price of Oracle Corp (ORCL, Financial) fell 2.94% to $54.81 in after-hours on Thursday. The computer tech corporation topped consensus estimates on second-quarter fiscal 2020 adjusted earnings by 1 cent, having posted a profit of 90 cents per share, but total revenues came in at $9.61 billion, falling $40 million short of expectations.
Adjusted earnings per share increased 12.5% year-over-year and total revenues grew 0.54% from the comparable quarter of fiscal 2019.
The cloud services and license support segment generated 71% ($6.81 billion) of total revenues and the cloud license and on-premise license segment generated 12% ($1.13 billion). The hardware segment accounted for 9% ($871 million) and the service segment contributed 8% ($786 million)
Year-over-year, cloud services and license support gained 3%, cloud license and on-premise license lost 7%, hardware lost 2% and service lost 1%.
In a statement, CEO Safra Catz commented on the second-quarter results:
“This consistent rapid growth in the now multibillion dollar ERP segment of our cloud applications business has enabled Oracle to deliver a double-digit EPS growth rate year-after-year. I fully expect we will do that again this year.”
The balance sheet had approximately $27.4 billion in cash and short-term securities and about $50.67 billion in long term debt as of Nov. 30. Deferred revenues totaled $8.09 billion and total equity was $16.19 billion.
The board announced the payment of a quarterly dividend of 24 cents per common share on Jan. 23, 2020, which is in line with the prior payment. In order to benefit, investors must be on the company’s record no later than Jan. 9. The quarterly cash dividend produces a forward dividend yield of 1.7% and a trailing 12-month dividend yield of 1.6% as of Dec. 12.
The share price of Oracle rose 21% in the past year through Dec. 11 to above the 200-, 100- and 50-day simple moving average lines. The share price closed at $56.47 on Thursday for a market capitalization of $185.36 billion.
The stock has a 52-week range of $42.40 to $60.50.
Sell-side analysts on Wall Street recommend holding shares of Oracle with an average price target of $56.24.
Adobe
Shares of Adobe Inc. (ADBE, Financial) jumped 3.12% to a price of $315.50 per unit in extended trading on Thursday after beating market expectations on adjusted earnings and total revenue for the compay's fourth quarter of fiscal 2019, which ended on Nov. 29.
The San Jose, California-based software company posted adjusted earnings of $2.29 per share on record quarterly total revenue of $2.99 billion, beating market expectations for adjusted earnings of $2.26 per share on total revenue of $2.79 billion.
Year-over-year, adjusted earnings per share increased 25.1% and total revenue increased 21.5%.
By segment, Subscription accounted for $2.69 billion in revenue (a 23% gain), Product was $167.1 million in revenue (an 11.1% gain) and Services and Support was $138 million in revenue (a 6.1% gain).
In a statement, President and CEO Shantanu Narayen explained fourth-quarter numbers:
“Adobe's phenomenal performance in Q4 capped a record fiscal 2019 with revenue exceeding $11 billion. Adobe’s vision, category leadership, continuous product innovation and large and loyal customer base position us well for 2020 and beyond.”
For the first quarter of fiscal 2020, Adobe targeted a total revenue of $3.04 billion versus analysts’ projections of $3.08 billion. The company expects adjusted earnings per share of $2.23, which is in line with analysts.
For the full year of fiscal 2020, Adobe sees total revenue at $13.15 billion, which is slightly below market expectations for total revenue of $13.16 billion, and forecasts adjusted earnings per share of $9.75, which is also somewhat below estimates of $9.76.
In addition to fourth-quarter results and various projections for fiscal 2020, Adobe reported results for the entire year of fiscal 2019, which saw total revenue hitting an annual record of $11.17 billion and operating income increasing 15% to $3.27 billion. Net income advanced nearly 14% to $2.95 billion, and the operating cash flow also achieved an annual record of $4.42 billion.
During the full year of fiscal 2019, Adobe bought back approximately 9.9 million shares of its own common stock, of which 28.3% was repurchased in the last quarter.
The balance sheet had $4.18 billion in cash on hand and short-term securities and $992.15 million in total debt as of Nov. 29. Deferred revenues totaled $3.5 billion. Total equity was worth about $10.53 billion.
Shares were trading around $305.96 at close on Dec. 11 for a market capitalization of $148.11 billion. The stock price has gained 33% in the past year through Dec. 12 to place substantially above the 200-, 100- and 50-day simple moving average lines.
The stock has a 52-week range of $204.95 to $313.11.
Sell-side analysts on Wall Street issued an overweight recommendation rating for shares of Adobe and have set an average price target of $326.88.
Disclosure: I have no positions in any securities mentioned.
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